Open Innovation in a dynamic Cournot duopoly

Irina Hasnas, Luca Lambertini () and Arsen Palestini ()

No 111, DICE Discussion Papers from Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)

Abstract: In recent years Open Innovation (OI) processes have been receiving growing attention from the empirical and theoretical economic literature, where a debate is taking place on the aspects of complementarity or substitutability between internal R&D and OI spillover. By means of a differential game approach, we analyze the case of substitutability in an OI setup in a Cournot duopoly where knowledge spillovers are endogenously determined via the R&D process. The game produces multiple steady states, allowing for an asymmetric solution where a firm may trade off the R&D investment against information absorption from the rival. The technical analysis and the numerical simulations point out that the firm which commits to a higher level of OI absorption produces a smaller output and enjoys higher profits than its rival.

Keywords: R&D; spillovers; dynamic games (search for similar items in EconPapers)
JEL-codes: C73 L13 O31 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-ino, nep-ipr, nep-pr~, nep-knm, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/83954/1/770081037.pdf (application/pdf)

Related works:
Journal Article: Open Innovation in a dynamic Cournot duopoly (2014)
Working Paper: Open Innovation in a Dynamic Cournot Duopoly (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:dicedp:111

Access Statistics for this paper

More papers in DICE Discussion Papers from Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE) Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().