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R&D Networks

Sanjeev Goyal and Jose Luis Moraga ()
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Jose Luis Moraga: Groningen University

No 00-075/1, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: We develop a model of strategic networks that captures two distinctive features of interfirm collaboration: bilateral agreements and nonexclusive relationships. Our analysis highlights the relationship between market competition, firms' incentives to invest in R&D, and the architecture of collaboration networks. In the absence of firm rivalry, the complete network, where each firm collaborates with all others, is uniquely stable, industry-profit maximizing, and efficient. By contrast, under strong market rivalry the complete network is stable, but intermediate levels of collaboration and asymmetric networks are more attractive from a collective viewpoint. This suggests that competing firms may have excessive incentives to form collaborative links. This discussion paper has resulted in a publication in The Rand Journal of Economics , 2001, 32(4), 686-707.

Keywords: strategic alliances; networks; research and development (search for similar items in EconPapers)
JEL-codes: D21 D43 (search for similar items in EconPapers)
Date: 2000-09-14
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Journal Article: R&D Networks (2001)
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