Strategic product R&D investment policy under international rivalry in the presence of demand spillover effects
This paper first presents the optimal conditions for strategic R&D investment policy in the cases of noncooperative and cooperative R&D investment policies with international rivalry. Then we deal with a model of strategic product (i.e., quality-improving) R&D investment competition. In particular, we analyze an optimal R&D investment policy with regard to the two cases in the presence of demand spillover effects associated with improving the quality of a product. We show how optimality depends on the strength of demand spillover effects. We also consider the same problems assuming heterogeneous consumers and alternative utility functions.
|Date of creation:||Sep 2012|
|Date of revision:||Sep 2012|
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Web page: http://www-econ.kwansei.ac.jp/~econ/index_e.html
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