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R&D Spillovers and Welfare Effect of Privatization with an R&D Subsidy

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  • Lee, Sang-Ho
  • Muminov, Timur

Abstract

We reexamine the results in Gil Molto et al. (2011) and compare the welfare effect of privatization policy in an R&D competition between a mixed duopoly and a private duopoly with an R&D subsidy. We show that an R&D subsidy with privatization policy is beneficial for society unless the spillovers rate is sufficiently low. Otherwise, public R&D leadership in a mixed market is socially superior.

Suggested Citation

  • Lee, Sang-Ho & Muminov, Timur, 2020. "R&D Spillovers and Welfare Effect of Privatization with an R&D Subsidy," MPRA Paper 99937, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:99937
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    References listed on IDEAS

    as
    1. Lee, Sang-Ho & Muminov, Timur K. & Tomaru, Yoshihiro, 2017. "Partial Privatization And Subsidization In A Mixed Duopoly: R&D Versus Output Subsidies," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 58(2), pages 163-177, December.
    2. Jim Jin & Rabah Amir & Madjid Amir, 2000. "Sequencing R&D decisions in a two-period duopoly with spillovers," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 15(2), pages 297-317.
    3. Vasileios Zikos, 2007. "A Reappraisal of the Irrelevance result in mixed duopoly: A note on R&D competition," Economics Bulletin, AccessEcon, vol. 12(8), pages 1-6.
    4. Lee, Sang-Ho & Tomaru, Yoshihiro, 2017. "Output and R&D subsidies in a mixed oligopoly," MPRA Paper 84410, University Library of Munich, Germany.
    5. Kesavayuth, Dusanee & Zikos, Vasileios, 2013. "R&D versus output subsidies in mixed markets," Economics Letters, Elsevier, vol. 118(2), pages 293-296.
    6. Dusanee Kesavayuth & Sang-Ho Lee & Vasileios Zikos, 2018. "Merger and Innovation Incentives in a Differentiated Industry," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 25(2), pages 207-221, May.
    7. Marco Marinucci, 2012. "A primer on R&D cooperation among firms," Questioni di Economia e Finanza (Occasional Papers) 130, Bank of Italy, Economic Research and International Relations Area.
    8. Maria José Gil-Moltó & Joanna Poyago-Theotoky & Vasileios Zikos, 2011. "R&D Subsidies, Spillovers, and Privatization in Mixed Markets," Southern Economic Journal, John Wiley & Sons, vol. 78(1), pages 233-255, July.
    9. Sang‐Ho Lee & Timur K. Muminov, 2021. "R&D Information sharing in a mixed duopoly and incentive subsidy for research joint venture competition," Bulletin of Economic Research, Wiley Blackwell, vol. 73(2), pages 154-170, April.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Privatization; R&D subsidy; R&D spillovers; R&D leadership;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises

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