The Effect of Entry on R&amp;D Networks

Petrakis, Emmanuel; Tsakas, Nikolas

doi:10.2139/ssrn.2704255

Cited by 4 publications

(3 citation statements)

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“…The microfoundation of our empirical illustration is a Cournot competition model with firms engaging in R&D investment and collaborations to lower production cost. This model has been adopted by d' Aspremont and Jacquemin (1988), Goyal and Moraga-Gonzalez (2001), Petrakis and Tsakas (2018) and König et al (2019) to study R&D networks. More specifically, consider a set of firms N = {1, .…”

Section: A Simple Model Of Randd Collaborationsmentioning

confidence: 99%

A Structural Model for the Coevolution of Networks and Behavior

König

Hsieh

Liu

2022

The Review of Economics and Statistics

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This paper introduces a structural model for the coevolution of networks and behavior. We characterize the equilibrium of the underlying game and adopt the Bayesian Double Metropolis-Hastings algorithm to estimate the model. We further extend the model to incorporate unobserved heterogeneity and show that ignoring unobserved heterogeneity can lead to biased estimates in simulation experiments. We apply the model to study R&D investment and collaboration decisions in the chemical and pharmaceutical industry and find a positive knowledge spillover effect. Our model also provides a tractable framework for a long-run key player analysis.

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Section: A Simple Model Of Randd Collaborationsmentioning

confidence: 99%

A Structural Model for the Coevolution of Networks and Behavior

König

Hsieh

Liu

2022

The Review of Economics and Statistics

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“…Their findings are beneficial to innovation strategy, choice of organizational form, IP noncompete decisions, and regulation policy. Petrakis and Tsakas (2018) made research on the effect of entry on R&D networks, finding that the presence of a potential entrant often alters the incentives of incumbents to collaborate. MacDonald and Ryall (2018) examined the effect of any new agent on the value captured by an incumbent, and their research showed that knowing that the entrant can replace the incumbent is not enough to determine the impact of entry on guaranteed minimum profits.…”

Section: Literature Reviewmentioning

confidence: 99%

More market awareness, more profit? Competitive environments, business expansions, and two‐sided markets

Zhang

2020

Manage Decis Econ

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Purpose: This study presents a game‐theoretic model in which a potential entrant platform expands a new business to compete with an incumbent platform. Findings: The results indicate that the potential entrant platform will never increase the market awareness of its new business beyond a threshold value, even if it is cost‐free. In addition, the profit of the incumbent platform may be even greater when facing competition. Furthermore, the optimal pricing of the potential entrant platform depends on the network effects. Conclusion and managerial implications: In order to compete with the incumbent platform, the potential entrant platform needs to increase its market awareness rationally, and the incumbent platform may accommodate the entry of a potential entrant under certain conditions.

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“…Klepper (2002) provides a compelling analysis of the process and evidence on the survival of firms with such higher R&D productivities. Similarities in the R&D productivities of firms within an industry may also arise over time because of industry-wide learning-by-doing spillovers (Irwin and Klenow (1994)), knowledge spillovers through worker mobility (Stoyanov and Zubanov (2014) and Mostafa and Klepper (2018)), and technology-sharing agreements between competitors (Petrakis and Tsakas (2018)), including cross-licensing arrangements (Choi and Gerlach (2019)). Our model can thus be considered as one that tries to capture the R&D environment faced by firms at the end of such processes.…”

Section: Introductionmentioning

confidence: 99%