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Innovation frequency of durable complementary goods

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  • Chen, Yijuan

Abstract

Focused on innovation frequency of durable complementary goods, this paper shows that interdependency of innovation decisions generically gives rise to coordination failure between the producers. More importantly, the coordination failure may arise in opposite directions: Not only may the producers delay introducing new products, they may also introduce new products faster than the social optimum. The possibility of hastened innovations is in contrast to the conclusion from the literature focused on the monopolistic setting. The results provide a caution for policy-makers, and on the other hand serve as benchmarks for future studies incorporating competition.

Suggested Citation

  • Chen, Yijuan, 2012. "Innovation frequency of durable complementary goods," Journal of Mathematical Economics, Elsevier, vol. 48(6), pages 407-421.
    • Handle: RePEc:eee:mateco:v:48:y:2012:i:6:p:407-421
    DOI: 10.1016/j.jmateco.2012.08.004
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    More about this item

    Keywords

    Dynamic innovation; Durable goods; Complements;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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