Endogenous Spillovers under Cournot Rivalry and Co-opetitive Behaviors
We develop a model of Cournot oligopolists with endogenous R§D spillovers where a specific type of co-opetition is introduced. The two principle factors of R§D spillovers, namely the absorptive capacity and the information-sharing parameter, are assumed to depend positively on the percentage of knowledge the firm chooses to codify and reveal. It is shown that identical firms that are rivals on the final good market do not necessarily choose the lowest level for the spillover parameters. Furthermore, there is some justification for a subsidy to knowledge codification and information-sharing. However, the latter is obtained under conditions on firms' technologies and spillover functions which ensure the emergence of symmetric solutions.
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