Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/24670
Authors: 
Cerquera Dussán, Daniel
Year of Publication: 
2007
Series/Report no.: 
ZEW Discussion Papers 07-086
Abstract: 
We develop a model of R&D competition between an incumbent and a potential entrant with network externalities and durable goods. We show that the threat of entry eliminates the commitment problem that an incumbent may face in its R&D decision due to the goods? durability. Moreover, a potential entrant over-invests in R&D and an established incumbent might exhibit higher, equal or lower R&D investments in comparison with the social optimum. In our model, the incumbent?s commitment problem and the efficiency of its R&D level are determined by the extent of the network externalities.
Subjects: 
Network externalities
Durable Goods
Innovation
Imperfect Competition
JEL: 
O31
L13
D85
D21
Document Type: 
Working Paper

Files in This Item:
File
Size
470.49 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.