Complementarity between Product and Process innovation in a Monopoly Setting
We study complementarity between product and process innovation in a monopoly setting. First we consider the possibility for the firm to alternatively invest only along one of the two directions and compare the incentives of process vs product innovation. Then we allow the firm to invest simultaneously in both activities, showing that both investment levels as well as the profit are higher than in case of individual investment. Product and process innovations are then complementary and the firm always prefers a simultaneous adoption.
|Date of creation:||2005|
|Date of revision:|
|Contact details of provider:|| Postal: Piazza Scaravilli, 2, and Strada Maggiore, 45, 40125 Bologna|
Phone: +39 051 209 8019 and 2600
Fax: +39 051 209 8040 and 2664
Web page: http://www.dse.unibo.it
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Luca Lambertini, 2004. "Process and product R&D by a multiproduct monopolist: a reply to Lin," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 745-749, October.
- Christine Halmenschlager, 2004.
"R&D-cooperating laggards versus a technological leader,"
Economics of Innovation and New Technology,
Taylor & Francis Journals, vol. 13(8), pages 717-732.
- C. Halmenschlager, 2003. "R&D-Cooperating Lagards versus a Technological Leader," Working Papers ERMES 0308, ERMES, University Paris 2.
- Mukesh Eswaran & Nancy Gallini, 1996. "Patent Policy and the Direction of Technological Change," RAND Journal of Economics, The RAND Corporation, vol. 27(4), pages 722-746, Winter.
- L. Lambertini & R. Orsini, 2000.
"Process and Product Innovation in a Vertically Differentiated Monopoly,"
367, Dipartimento Scienze Economiche, Universita' di Bologna.
- Lambertini, Luca & Orsini, Raimondello, 2000. "Process and product innovation in a vertically differentiated monopoly," Economics Letters, Elsevier, vol. 68(3), pages 333-337, September.
- AMIR, Rabah, 1994.
"Cournot Oligopoly and the Theory of Supermodular Games,"
CORE Discussion Papers
1994013, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Amir, Rabah, 1996. "Cournot Oligopoly and the Theory of Supermodular Games," Games and Economic Behavior, Elsevier, vol. 15(2), pages 132-148, August.
- Milgrom, Paul & Roberts, John, 1995. "Complementarities and fit strategy, structure, and organizational change in manufacturing," Journal of Accounting and Economics, Elsevier, vol. 19(2-3), pages 179-208, April.
- E. Bacchiega & L. Lambertini & A. Mantovani, 2007.
"Process and product innovation in a vertically differentiated industry,"
583, Dipartimento Scienze Economiche, Universita' di Bologna.
- Emanuele Bacchiega & Luca Lambertini & Andrea Mantovaini, 2011. "Process And Product Innovation In A Vertically Differentiated Industry," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 13(02), pages 209-221.
- Klepper, Steven, 1996. "Entry, Exit, Growth, and Innovation over the Product Life Cycle," American Economic Review, American Economic Association, vol. 86(3), pages 562-83, June.
- Bonanno, Giacomo & Haworth, Barry, 1998. "Intensity of competition and the choice between product and process innovation," International Journal of Industrial Organization, Elsevier, vol. 16(4), pages 495-510, July.
- Pia Weiss, 2002. "Adoption of Product and Process Innovations in Differentiated," Industrial Organization 0212002, EconWPA.
- d'Aspremont, Claude & Jacquemin, Alexis, 1988.
"Cooperative and Noncooperative R&D in Duopoly with Spillovers,"
American Economic Review,
American Economic Association, vol. 78(5), pages 1133-37, December.
- d'ASPREMONT, Claude & JACQUEMIN, Alexis, . "Cooperative and noncooperative R&D in duopoly with spillovers," CORE Discussion Papers RP 823, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Luca Lambertini, 2003.
"The monopolist's optimal R&D portfolio,"
Oxford Economic Papers,
Oxford University Press, vol. 55(4), pages 561-578, October.
- Utterback, James M & Abernathy, William J, 1975. "A dynamic model of process and product innovation," Omega, Elsevier, vol. 3(6), pages 639-656, December.
- Susan Athey & Armin Schmutzler, 1995. "Product and Process Flexibility in an Innovative Environment," RAND Journal of Economics, The RAND Corporation, vol. 26(4), pages 557-574, Winter.
- Ron Adner & Daniel Levinthal, 2001. "Demand Heterogeneity and Technology Evolution: Implications for Product and Process Innovation," Management Science, INFORMS, vol. 47(5), pages 611-628, May.
- Cohen, Wesley M & Klepper, Steven, 1996. "Firm Size and the Nature of Innovation within Industries: The Case of Process and Product R&D," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 232-43, May.
- Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-28, June.
- Lin, Ping & Saggi, Kamal, 2002. "Product differentiation, process R&D, and the nature of market competition," European Economic Review, Elsevier, vol. 46(1), pages 201-211, January.
- Hallam, Arne, 1999. "Industrial Organization: Contemporary Theory and Practice (Instructor's Manual--Text by L. Pepall, D. J. Richards, and G. Norman)," Staff General Research Papers Archive 5310, Iowa State University, Department of Economics.
- Rosenkranz, Stephanie, 2003. "Simultaneous choice of process and product innovation when consumers have a preference for product variety," Journal of Economic Behavior & Organization, Elsevier, vol. 50(2), pages 183-201, February.
- Vives, X., 1988.
"Nash Equilibrium With Strategic Complementarities,"
UFAE and IAE Working Papers
107-88, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Qiu, Larry D., 1997. "On the Dynamic Efficiency of Bertrand and Cournot Equilibria," Journal of Economic Theory, Elsevier, vol. 75(1), pages 213-229, July.
When requesting a correction, please mention this item's handle: RePEc:bol:bodewp:533. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dipartimento Scienze Economiche, Universita' di Bologna)
If references are entirely missing, you can add them using this form.