One-Way Spillovers, Endogenous Innovator/Imitator Roles and Research Jointventures
We consider a two-period duopoly characterized by a one-way spillover structure in process R&D and a very broad specification of product market competition. We show that a priori identical firms always engage in different levels of R&D, at equilibrium, thus giving rise to an innovator/imitator configuration and ending up with different sizes. In view of this endogenous firm heterogeneity, the social benefits of, and the firms´ incentives for, research joint ventures are somewhat different from the case of ex post firm symmetry. The key properties of the game are submodularity (R&D decisions are strategic substitutes) and lack of global concavity.
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|Date of creation:||Jun 1998|
|Date of revision:|
|Publication status:||Published in: Games and Economic Behaviour, 31(1), 2000, 1-25|
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