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Endogenous R&D symmetry in linear duopoly with one-way spillovers

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  • TESORIERE, Antonio

Abstract

A duopoly model of cost reducing R&D-Cournot competition is extended to study the endogenous timing of R&D strategic investment. Under the assumption that R&D spillovers only flow from the R&D leader to the follower, sequential and simultaneous play at the R&D stage are compared, in order to assess the role of technological externalities in stimulating or attenuating endogenous firm asymmetry. The only timing structure of the R&D stage sustainable as subgame-perfect Nash equilibrium involves simultaneous play and zero spillovers.

Suggested Citation

  • TESORIERE, Antonio, 2005. "Endogenous R&D symmetry in linear duopoly with one-way spillovers," LIDAM Discussion Papers CORE 2005045, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2005045
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    References listed on IDEAS

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    More about this item

    Keywords

    endogenous symmetry; endogenous timing; Stackelberg equilibrium;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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