The Monopolist's Optimal R&D Portfolio

Luca Lambertini ()

Working Papers from Dipartimento Scienze Economiche, Universita' di Bologna

Abstract: The monopolist s incentives towards product and process innovations are evaluated against the social optimum. The main findings are that (i) the incentive to invest in cost-reducing R&D is inversely related to the number of varieties being supplied at equilibrium, under both regimes; (ii) distortions obtain under monopoly, w.r.t. both the number of varieties and the technology. With substitutes (respectively, complements), the monopolist s product range is smaller (respectively, larger) than under social planning. For any given number of goods, the monopolist operates at a higher marginal cost than the planner does.

Date: 2000
New Economics Papers: this item is included in nep-ino and nep-mic
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Related works:
Journal Article: The monopolist's optimal R&D portfolio (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:bol:bodewp:391

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