DEMAND UNCERTAINTY, R&D LEADERSHIP AND RESEARCH JOINT VENTUREs

Paul O'Sullivan ()
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Paul O'Sullivan: Economics, National University of Ireland, Maynooth

Economics Department Working Paper Series from Department of Economics, National University of Ireland - Maynooth

Abstract: This paper analyses the desirability of RJV formation when firms may choose their R&D investment before or after any demand uncertainty is resolved. If a R&D leader accommodates a follower, multiple Nash equilibria are possible under both R&D competition and RJV formation. If a R&D leader prevents activity by the follower, this is only expected to be profitable at very low spillover and unit R&D cost levels. Whether R&D leadership when competing in R&D is expected to be more profitable than waiting and forming a RJV will depend on unit R&D costs and spillovers. Maximising expected welfare may require an active role for government.

JEL-codes: D21 D81 L13 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2014
New Economics Papers: this item is included in nep-com, nep-cse, nep-ino and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:may:mayecw:n252-14.pdf

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