Public policy and R&D when research joint ventures are costly

Jon Vilasuso and Mark R. Frascatore

Canadian Journal of Economics, 2000, vol. 33, issue 3, 818-839

Abstract: In this paper we examine the role of policy when forming a R&D joint venture is costly. Contrary to previous studies, we document an active role for public policy, since the interests of firms are not necessarily aligned with societal interests. The nature of policy, however, depends on the joint venture cost. If it is relatively low, then policy may call for subsidizing the joint venture to encourage collaboration. If forming a joint venture is very costly, however, then there are cases where social welfare is improved if policy encourages R&D competition with no joint venture.

JEL-codes: D43 L13 (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (19)

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