Beat 'em or Join 'em? Export Subsidies versus International Research Joint Ventures in Oligopolistic Markets

J. Peter Neary and Paul O'Sullivan

Scandinavian Journal of Economics, 1999, vol. 101, issue 4, 577-596

Abstract: We compare adversarial with cooperative industrial and trade policies in a dynamic oligopoly game in which a home and foreign firm compete in R&D and output and, because of spillovers, each firm benefits from the other's R&D. When the government can commit to an export subsidy, such a policy raises welfare relative to cooperation, except when R&D is highly effective and spillovers are near‐complete. Without commitment, however, subsidisation may yield welfare levels much lower than cooperation and lower even than free trade, though qualifications to the dangers from no commitment are noted. JEL classification: F12; F13

Date: 1999
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https://doi.org/10.1111/1467-9442.00174

Related works:
Working Paper: Beat Em or Join Em: Export Subsidies versus International Research Joint Ventures in Oligopolistic Markets (1998)
Working Paper: Beat 'Em or Join 'Em?: Export Subsidies Versus International Research Joint Ventures in Oligopolistic Markets (1998)
Working Paper: Beat 'em or join 'em: export subsidies versus international research joint ventures in oligopolistic markets (1998)
Working Paper: Beat'Em Or Join'Em? Export Subsidies Versus International Research Joint Ventures in Oligopolistic Markets (1998)
Working Paper: Beat 'em or Join 'em?: Export Subsidies Versus International Research Joint Ventures in Oligopolistic Markets (1997)
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