Economics at your fingertips  

Cournot–Bertrand comparisons under R&D competition: Output versus R&D subsidies

Jiaqi Chen and Sang-Ho Lee

International Journal of Economic Theory, 2023, vol. 19, issue 1, 77-100

Abstract: We compare Cournot and Bertrand competitions with R&D investment under output versus R&D subsidy policies. We demonstrate that Cournot firms invest more (less) in R&D and the government grants more (less) subsidies than for Bertrand firms with output (R&D) subsidies. We also find that both competition modes yield the same welfare with output subsidy, while Bertrand yields higher welfare than Cournot with R&D subsidy. Finally, firms' profits and welfare in Cournot are higher under output subsidies, while they can be higher in Bertrand under R&D subsidies if the product substitutability is high and the firm's R&D investment is efficient.

Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)

Related works:
Working Paper: Cournot-Bertrand comparison under R&D competition: Output versus R&D subsidies (2021) Downloads
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:

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1742-7355

Access Statistics for this article

International Journal of Economic Theory is currently edited by Kazuo Nishimura and Makoto Yano

More articles in International Journal of Economic Theory from The International Society for Economic Theory
Bibliographic data for series maintained by Wiley Content Delivery ().

Page updated 2023-10-08
Handle: RePEc:bla:ijethy:v:19:y:2023:i:1:p:77-100