R&D networks and absorptive capacity in a Salop model

Luca Correani and Fabio Di Dio ()

Research in Economics, 2019, vol. 73, issue 2, 123-128

Abstract: The paper investigates the incentives of Salop-type oligopolistic firms to cooperate and the architecture of the resulting collaboration networks. We find that when spillovers are exogenous, firm profits are not affected by the network structure. On the contrary, with endogenous spillovers (absorptive capacity) firms tend to form less dense networks. We also seek out the architecture of socially efficient networks, showing that social welfare is maximised in the complete network. Also, given the network structure we conclude that a Salop industry could be characterized by a general tendency to under-connection.

Keywords: Salop; Cooperation; R&D networks (search for similar items in EconPapers)
JEL-codes: C70 D43 L13 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reecon:v:73:y:2019:i:2:p:123-128

DOI: 10.1016/j.rie.2019.03.001

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