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Lambertini, Luca ; Cellini, Roberto
(1999)
Growth in a Differentiated Oligopoly with Product Innovation.
Bologna:
Dipartimento di Scienze economiche DSE,
p. 20.
DOI 10.6092/unibo/amsacta/4946.
In: Quaderni - Working Paper DSE
(363).
ISSN 2282-6483.
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Abstract
We present a two-sector model where oligopolistic firms sell differentiated products. New products are introduced over time through formal R&D activity. Market competition takes place either a la Cournot or a la Bertrand. We show that tougher competition associated wit price-setting behavior does not entail a larger social welfare as long as it requires more effort for the production of the final goods.
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