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Stepwise innovation by an oligopoly

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  • Gilbert, Richard
  • Riis, Christian
  • Riis, Erlend S.

Abstract

Stepwise models of technological progress described by Aghion et al. (1997, 2001, 2005) capture the incentives of firms to innovate in order to escape competition and the disincentives from sharing profits with other technological leaders. The models yield intuitively appealing predictions about the effects of competition on innovation but they are limited to competition in duopolies. This paper extends the models to oligopolies and shows that the predictions of the effects of competition on innovation from the duopoly models do not generalize to oligopolies.

Suggested Citation

  • Gilbert, Richard & Riis, Christian & Riis, Erlend S., 2018. "Stepwise innovation by an oligopoly," International Journal of Industrial Organization, Elsevier, vol. 61(C), pages 413-438.
    • Handle: RePEc:eee:indorg:v:61:y:2018:i:c:p:413-438
    DOI: 10.1016/j.ijindorg.2018.10.001
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    Cited by:

    1. Chen, You-hua & Chen, Liu-man & Mishra, Ashok K., 2021. "Information, Capacity Constraints and Quality on Firms Competition," 2021 ASAE 10th International Conference (Virtual), January 11-13, Beijing, China 329427, Asian Society of Agricultural Economists (ASAE).
    2. Richard J. Gilbert, 2019. "Competition, Mergers, and R&D Diversity," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(3), pages 465-484, May.
    3. Bauer, Johannes M. & Prado, Tiago S., 2020. "Lessons from Innovation Economics for Digital Platform Policy," ITS Conference, Online Event 2020 224846, International Telecommunications Society (ITS).

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