Incentives to Innovate in a Cournot Oligopoly

Delbono, Flavio ; Denicolò, Vincenzo (1988) Incentives to Innovate in a Cournot Oligopoly. Bologna: Dipartimento di Scienze economiche DSE, p. 30. DOI 10.6092/unibo/amsacta/5370. In: Quaderni - Working Paper DSE (44). ISSN 2282-6483.
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Abstract

We study the R&D performance of Cournot aligopolists. To this end we model a one-shot noncooperative game in which firms invest in R&D, with the aim of being first in an uncertain competition for a patentable cost-reducing innovation. The incentives to innovate are market profits and not exogenously given prizes as in most of the earlier literature. Thus, incentives depend on the number of firms. We show that increasing rivalry may increase or decrease the individual R&D espenditure, there may be underinvestment with the various effect to the socially optimal level. Moreover, we identify the various effects which are responsible for the difference between our results and some conclusions of closely related contributions.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Delbono, Flavio0000-0001-9030-4048
Denicolò, Vincenzo0000-0001-8371-4241
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ISSN
2282-6483
DOI
Deposit date
19 Jul 2016 13:27
Last modified
19 Jul 2016 13:27
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