Competing or Colluding in a Stochastic Environment

Adriana Breccia and Hector Salgado-Banda
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Adriana Breccia: Univertsity of York
Hector Salgado-Banda: Banco de Mexico

No 423, Computing in Economics and Finance 2006 from Society for Computational Economics

Abstract: This paper analyses collusion by innovative firms and the role of patents in a continuous-time real options framework. A patent-investment race model is formulated in which innovative firms bargain and reach collusive agreements. It is shown that, while collusion always delays innovation, it does not necessarily delay competition. Depending on a number of factors, collusion can actually accelerate competitio

JEL-codes: C7 D8 K4 L1 (search for similar items in EconPapers)
Date: 2006-07-04
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Persistent link: https://EconPapers.repec.org/RePEc:sce:scecfa:423

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