Product market competition and R&D rivalry
Document Type
Journal article
Source Publication
Economics Letters
Publication Date
1-1-1998
Volume
58
Issue
1
First Page
105
Last Page
111
Publisher
Elsevier B.V.
Keywords
R&D rivalry, product market competition
Abstract
This paper analyzes the impact of a future R&D race on current firm behavior in the product market. It is shown that, in order to “soften” rivals in the future R&D race, firms behave less aggressively in the pre-innovation product market than in the standard duopoly models. As a result, the R&D rates are lower than what firms would choose if standard duopoly outcomes are assumed. R&D cooperation is shown to be capable of restoring the duopoly outcome.
DOI
10.1016/S0165-1765(97)00176-6
Print ISSN
01651765
E-ISSN
18737374
Publisher Statement
Copyright © 1998 Elsevier S.A.
Access to external full text or publisher's version may require subscription.Full-text Version
Publisher’s Version
Language
English
Recommended Citation
Lin, P. (1998). Product market competition and R&D rivalry. Economics Letters, 58(1), 105-111. doi: 10.1016/S0165-1765(97)00176-6