Strategic product R&D investment policy under international rivalry in the presence of demand spillover effects

Tsuyoshi Toshimitsu

No 95, Discussion Paper Series from School of Economics, Kwansei Gakuin University

Abstract: This paper first presents the optimal conditions for strategic R&D investment policy in the cases of noncooperative and cooperative R&D investment policies with international rivalry. Then we deal with a model of strategic product (i.e., quality-improving) R&D investment competition. In particular, we analyze an optimal R&D investment policy with regard to the two cases in the presence of demand spillover effects associated with improving the quality of a product. We show how optimality depends on the strength of demand spillover effects. We also consider the same problems assuming heterogeneous consumers and alternative utility functions.

Keywords: strategic R&D investment policy; quality choice; international rivalry; demand spillover effects (search for similar items in EconPapers)
JEL-codes: F12 F13 L13 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2012-09, Revised 2012-09
New Economics Papers: this item is included in nep-com, nep-cse and nep-ino
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http://192.218.163.163/RePEc/pdf/kgdp95.pdf First version, 2012 (application/pdf)

Related works:
Journal Article: Strategic Product R&D Investment Policy under International Rivalry in the Presence of Demand Spillover Effects (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:kgu:wpaper:95

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