Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/158894
Authors: 
Delbono, Flavio
Denicolò, Vincenzo
Year of Publication: 
1988
Series/Report no.: 
Quaderni - Working Paper DSE 51
Abstract: 
In this paper we study a one-shot game of R&D between two price-setting firms that are asymmetrically placed as they produce at different cost levels. First we prove the existence and the properties of a noncooperative equilibrium. Then, we show that the higher (lower) the discount rate, the lower (higher) the probability of innovating of the current leader. In a specialised version of the model we establish the effect of the productivity of R&D espenditure, initial cost gap, and market size on the expected identity of the winner of the patent race.
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc/3.0/
Document Type: 
Working Paper

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