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Competition, Innovation And Increasing Returns

Mario Amendola, Jean-Luc Gaffard () and Patrick Musso
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Mario Amendola: Università degli Studi di Roma "La Sapienza" = Sapienza University [Rome]
Patrick Musso: GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015-2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur

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Abstract: When firms enjoy increasing returns in presence of a high rate of innovation, competition may obtain due to the continuous changes in demand and cost conditions even when there is no differentiation and the products of competing firms are essentially homogeneous. In this paper we intend to provide theoretical structure to this conjecture, and to confirm it by carrying out a simulation analysis in the case of two firms competing on the market.

Keywords: Competition; Co-ordination; Innovation; Increasing returns (search for similar items in EconPapers)
Date: 2000
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Published in Economics of Innovation and New Technology, Taylor & Francis (Routledge), 2000, 9 (2), pp.149 - 181

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