Innovation frequency of durable complementary goods

Yijuan Chen

Journal of Mathematical Economics, 2012, vol. 48, issue 6, 407-421

Abstract: Focused on innovation frequency of durable complementary goods, this paper shows that interdependency of innovation decisions generically gives rise to coordination failure between the producers. More importantly, the coordination failure may arise in opposite directions: Not only may the producers delay introducing new products, they may also introduce new products faster than the social optimum. The possibility of hastened innovations is in contrast to the conclusion from the literature focused on the monopolistic setting. The results provide a caution for policy-makers, and on the other hand serve as benchmarks for future studies incorporating competition.

Keywords: Dynamic innovation; Durable goods; Complements (search for similar items in EconPapers)
Date: 2012
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Related works:
Working Paper: Innovation Frequency of Durable Complementary Goods (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:48:y:2012:i:6:p:407-421

DOI: 10.1016/j.jmateco.2012.08.004

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