Product market competition policy and technological performance

Stephen Martin ()

No 1998-01, CIE Discussion Papers from University of Copenhagen. Department of Economics. Centre for Industrial Economics

Abstract: Stricter competition policy reduces expected payoffs before and after innovation, but reduces pre-innovation payoffs relatively more than post-innovation payoffs, and therefore increases the equilibrium level of R&D activity: tough product-market competition policy stimulates innovation. There is an inverted-U relationship between competition policy and expected welfare. The model also permits analysis of the effect of R&D spillovers and of alternative R&D cooperation regimes on expected welfare, on R&D efforts, and on the expected time to discovery of a cost-saving innovation.

Keywords: antitrust; innovation (search for similar items in EconPapers)
JEL-codes: L40 O31 (search for similar items in EconPapers)
Pages: 33 pages
Date: 1998-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published in: George Norman, Jacques-François Thisse (eds.). Market Structure and Competition Policy: Game-Theoretic Approaches. Cambridge University Press, 2000, pp 161-190

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