The pace of intermediate-product introductions

Rajeev K. Tyagi and Jagmohan S. Raju
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Rajeev K. Tyagi: Paul Merage School of Business, University of California, Irvine, USA, Postal: Paul Merage School of Business, University of California, Irvine, USA
Jagmohan S. Raju: The Wharton School, University of Pennsylvania, USA, Postal: The Wharton School, University of Pennsylvania, USA

Managerial and Decision Economics, 2006, vol. 27, issue 7, 527-535

Abstract: This paper models frequency of introductions of newer generations of an intermediate-product sold by an upstream 'developer' firm to downstream manufacturer firms. The manufacturers use the intermediate product to manufacture final products, and are heterogeneous in the time it takes them to develop and introduce final products based on the latest generation of the intermediate product. This downstream heterogeneity could arise, for example, from heterogeneity in manufacturers' technical skills or existing patent regimes. Among other results, we show that the optimal frequency of introduction of the intermediate-product can increase or decrease in the extent of this downstream heterogeneity. Copyright © 2006 John Wiley & Sons, Ltd.

Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:27:y:2006:i:7:p:527-535

DOI: 10.1002/mde.1270

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