| Title: |
Persistence of Monopoly, Innovation, and R&D Spillovers: Static versus Dynamic Analysis |
| Authors: |
Viatcheslav Vinogradov; Jel Classification L |
| Contributors: |
The Pennsylvania State University CiteSeerX Archives |
| Source: |
http://repec.org/sce2006/up.27075.1141772364.pdf. |
| Publication Year: |
2006 |
| Collection: |
CiteSeerX |
| Subject Terms: |
dynamic duopoly; R&D spillovers; persistence of monopoly; strategic predation; accommodation |
| Description: |
We build a dynamic duopoly model that accounts for the empirical observation of monopoly persistence in the long run. More specifically, we analyze the condi-tions under which it is optimal for the market leader in an initially duopoly setup to undertake pre-emptive R&D investment, (“strategic predation ” strategy) that eventually leads to exit of the follower firm. The follower is assumed to benefit from the innovative activities of the leader through R&D spillovers. The novel feature of our approach is that we introduce explicit dynamic model and contrast it with its static counterpart. Contrary to the predictions of the static model, strategic predation that leads to persistence of monopoly is in general optimal strategy to pursue in a dynamic framework when spillovers are not large. |
| Document Type: |
text |
| File Description: |
application/pdf |
| Language: |
English |
| Relation: |
http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.615.7400; http://repec.org/sce2006/up.27075.1141772364.pdf |
| Availability: |
http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.615.7400; http://repec.org/sce2006/up.27075.1141772364.pdf |
| Rights: |
Metadata may be used without restrictions as long as the oai identifier remains attached to it. |
| Accession Number: |
edsbas.54FEB03 |
| Database: |
BASE |