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Competition in Innovation and Imitation - A Theoretical and Experimental Study -

  • Uwe Cantner
  • Werner Gueth


  • Andreas Nicklisch


  • Torsten Weiland

For given product specifications by two competing firms the demand levels are determined by a randomly generated ideal composition of aspects. Firms can vary some demand. Although the product space is much too large to be explored systematically, we expect (and test for) rather reasonable innovative success and welfare levels due to own innovative attempts and imitation of a successful other. Parameter variations concern the pioneer advantage and search costs.

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Paper provided by Max Planck Institute of Economics, Strategic Interaction Group in its series Papers on Strategic Interaction with number 2004-02.

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Length: 17 pages
Date of creation: Nov 2003
Date of revision:
Handle: RePEc:esi:discus:2004-02
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  1. Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-96, September.
  2. Dasgupta, Partha & Stiglitz, Joseph, 1980. "Industrial Structure and the Nature of Innovative Activity," Economic Journal, Royal Economic Society, vol. 90(358), pages 266-93, June.
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