The Effects of Integration on R&D Incentives in Systems Markets

Jay Choi, Gwanghoon Lee () and Christodoulos Stefanadis
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Gwanghoon Lee: Korea Information Society Development Institute, 1-1 Juam

Netnomics, 2003, vol. 5, issue 1, 21-32

Abstract: Abstract We consider a systems market where two complementary components must be used in combination to provide valuable services. The market for the first component is monopolized whereas the market for the second is potentially served by multiple firms. We show that integration of the monopolist into the competitive complementary market may distort incentives for R&D, reducing total economic welfare.

Keywords: incentives; integration; R&D (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (7)

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DOI: 10.1023/A:1024969416825

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