Dynamic R&amp;D with spillovers: Competition vs cooperation

Cellini, Roberto; Lambertini, Luca

doi:10.1016/j.jedc.2008.08.006

Cited by 141 publications

(65 citation statements)

References 30 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Do note that Smrkolj and Wagener [34] show that the equilibrium considered in [27] is not subgame perfect. Time t is continuous: t ∈ [0, ∞[.…”

Section: The Modelmentioning

confidence: 97%

“…Our present model is an extension of the global monopoly framework of Hinloopen et al [31] to two firms, and it builds on Cellini and Lambertini [27]. Do note that Smrkolj and Wagener [34] show that the equilibrium considered in [27] is not subgame perfect.…”

Section: The Modelmentioning

confidence: 98%

“…The related literature [24,[27][28][29][30] has not considered initial marginal cost levels that exceed the choke price nor has it carried out a global analysis. In all these papers, any of the initial (permissible) technologies will be developed to full materialization; technologies that are only developed under specific regimes (i.e., product market collusion) remain hidden.…”

Section: ]mentioning

confidence: 99%

See 2 more Smart Citations

Research and Development Cooperatives and Market Collusion: A Global Dynamic Approach

Hinloopen

Smrkolj

Wagener

2017

J Optim Theory Appl

View full text Add to dashboard Cite

We present a continuous-time generalization of the seminal research and development model of d'Aspremont and Jacquemin (Am Econ Rev 78(5): [1133][1134][1135][1136][1137] 1988) to examine the trade-off between the benefits of allowing firms to cooperate in research and the corresponding increased potential for product market collusion. We show the existence of a solution to the optimal investment problem using a combination of results from viscosity theory and the theory of planar dynamical systems. In particular, we show that there is a critical level of marginal cost at which firms are indifferent between doing nothing and starting to develop the technology. We find that colluding firms develop further a wider range of initial technologies, pursue innovations more quickly, and are less likely to abandon a technology. Product market collusion could thus yield higher total surplus.

show abstract

“…Do note that Smrkolj and Wagener [34] show that the equilibrium considered in [27] is not subgame perfect. Time t is continuous: t ∈ [0, ∞[.…”

Section: The Modelmentioning

confidence: 97%

Section: The Modelmentioning

confidence: 98%

Section: ]mentioning

confidence: 99%

See 1 more Smart Citation

Research and Development Cooperatives and Market Collusion: A Global Dynamic Approach

Hinloopen

Smrkolj

Wagener

2017

J Optim Theory Appl

View full text Add to dashboard Cite

show abstract

“…Our present model is an extension of the global monopoly framework of Hinloopen et al (2013) to two firms and builds on Cellini and Lambertini (2009). Time t is continuous: t ∈ [0, ∞).…”

Section: The Modelmentioning

confidence: 99%

R&D Cooperatives and Market Collusion: A Global Dynamic Approach

2017

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. (American Economic Review, 1988) to examine the trade-off between the benefits of allowing firms to cooperate in R&D and the corresponding increased potential for product market collusion. We consider all trajectories that are candidates for an optimal solution as well as initial marginal cost levels that exceed the choke price. Firms that collude develop further a wider range of initial technologies, pursue innovations more quickly, and are less likely to abandon a technology. Product market collusion could thus yield higher total surplus. Terms of use: Documents in

show abstract

“…Whereas much of this literature is based on the consideration of static twostage games, a few contributions have explicitly considered the fact that in most oligopolies firms repeatedly interact on the market and can also repeatedly engage in cost reducing activities. Cellini and Lambertini (2009), Cellini and Lambertini (2011) and Breton et al (2004) consider dynamic oligopolies, where firms, which at each point in time compete on an oligopolistic market, can over time reduce their marginal costs by investing in R&D. Since it is assumed here that R&D investments imply persistent cost reduction, this dynamic strategic interaction is analyzed using differential game models. Contrary to these contributions the focus in this paper is set on cost reducing activities without persistent effects.…”

Section: Related Literaturementioning

confidence: 99%

Best response dynamics with level-n expectations in two-stage games

Dawid¹,

Heitmann²

2014

Journal of Economic Dynamics and Control

View full text Add to dashboard Cite

This paper analyzes behavior in repeatedly played two-stage games, where players choose actions in both stages according to best replies using 'level-n expectations' about the opponent's actions in both stages. Level-n expectations are recursively defined in a way that a player holding level n expectations correctly predicts the action of an opponent holding level n − 1 expectations.A general conceptual framework to study such dynamics for two-stage games is developed and it is shown that, contrary to results for single-stage games, the fixed points of the dynamics depend on the level of the expectations. In particular, for level-zero expectation, fixed points correspond to a Nash equilibrium of a simultaneous move version of the game, whereas (under certain conditions) fixed points converge towards the subgame perfect equilibrium of the two-stage game if the level of expectations goes to infinity. The approach is illustrated using a two-stage duopoly game, where firms in the first stage invest in activities reducing their marginal costs and in the second stage engage in Cournot competition. An increase in the level of expectations leads in the long run to higher cost reducing activities and higher output of the firms, however to lower profits. Level-two expectations are sufficient to move the fixed-point of the dynamics to a close neighbourhood of the subgame-perfect equilibrium.

show abstract

Dynamic R&D with spillovers: Competition vs cooperation

Cited by 141 publications

References 30 publications

Research and Development Cooperatives and Market Collusion: A Global Dynamic Approach

Research and Development Cooperatives and Market Collusion: A Global Dynamic Approach

R&D Cooperatives and Market Collusion: A Global Dynamic Approach

Best response dynamics with level-n expectations in two-stage games

Contact Info

Product

Resources

About