R&D Incentives in Vertically Related Markets
This paper focuses on incentives to invest in research and development (R&D) in vertically related markets. In a bilateral duopoly setup, we consider how process R&D incentives of the firms in both upstream and downstream market depend on the intensity of simultaneous interbrand and intrabra...
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Veröffentlicht in: | MAGKS - Joint Discussion Paper Series in Economics (Band 07-2013) |
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Autoren: | , |
Format: | Artikel |
Sprache: | Englisch |
Veröffentlicht: |
Philipps-Universität Marburg
2013
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Schlagworte: | |
Online Zugang: | PDF-Volltext |
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Zusammenfassung: | This paper focuses on incentives to invest in research and development (R&D) in vertically related markets. In a bilateral duopoly setup, we consider how process R&D incentives of the firms in both upstream and downstream market depend on the intensity of simultaneous interbrand and intrabrand competition. Among the results: both interbrand and intrabrand competition have twofold effects on R&D incentives. Existence of a vertically related market with imperfect competition lowers both the incentives to invest in process R&D and the competitive advantage through the R&D investment. We will show how the impact of a firm's R&D investments in either market on consumer surplus as well as on the profits of all firms in both markets depends on exogenous parameters. |
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ISSN: | 1867-3678 |
DOI: | 10.17192/es2024.0170 |