R&D Networks: Theory, Empirics, and Policy Implications

Michael D. König, Xiaodong Liu and Yves Zenou
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Michael D. König: CEPR, Swiss Economics Institute, and VU Amsterdam

The Review of Economics and Statistics, 2019, vol. 101, issue 3, 476-491

Abstract: We analyze a model of R&D alliance networks where firms are engaged in R&D collaborations that lower their production costs while competing on the product market. We provide a complete characterization of the Nash equilibrium and determine the optimal R&D subsidy program that maximizes total welfare. We then structurally estimate this model using a unique panel of R&D collaborations and annual company reports. We use our estimates to study the impact of targeted versus nondiscriminatory R&D subsidy policies and empirically rank firms according to the welfare-maximizing subsidies they should receive.

Date: 2019
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Related works:
Working Paper: R&D Networks: Theory, Empirics and Policy Implications (2014)
Working Paper: R&D Networks: Theory, Empirics and Policy Implications (2014)
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