Dynamic R&D with spillovers: Competition vs cooperation

Roberto Cellini () and Luca Lambertini

Journal of Economic Dynamics and Control, 2009, vol. 33, issue 3, pages 568-582

Abstract: We investigate dynamic R&D for process innovation in a Cournot duopoly where firms may either undertake independent ventures or form a cartel for cost-reducing R&D investments. By comparing the profit and welfare performances of the two settings in steady state, we show that private and social incentives towards R&D cooperation coincide for all admissible levels of the technological spillovers characterising innovative activity. We also evaluate the whole history of the dynamic system along the transition to the steady state, showing that the conflict between private and social incentives does not necessarily emerge.

Keywords: Differential; games; Process; innovation; R&D; cooperation; Spillovers (search for similar items in EconPapers)
Date: 2009
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Working Paper: Dynamic R&D with Spillovers: Competition vs Cooperation (2003)
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Persistent link: http://EconPapers.repec.org/RePEc:eee:dyncon:v:33:y:2009:i:3:p:568-582

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