Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159348
Authors: 
Lambertini, Luca
Year of Publication: 
2004
Series/Report no.: 
Quaderni - Working Paper DSE 507
Abstract: 
I investigate R&D efforts for process innovation in a monopoly with uncertain demand. Two different models are proposed, where either (i) the reservation price is affected by an additive shock and the marginal production cost is increasing, or (ii) a multiplicative shock on the slope of demand combines with a flat marginal production cost. In either case, price-setting behaviour generates a larger R&D investment than quantity-setting behaviour. An Arrowian interpretation of the first result and a Schumpeterian interpretation of the second are proposed.
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by/3.0/
Document Type: 
Working Paper

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