Economic integration, intensity of competition and R&D incentives

McVicar, Duncan (1999) Economic integration, intensity of competition and R&D incentives. Southampton, UK, University of Southampton, 39pp. (Discussion Papers in Economics and Econometrics 9914).


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A two-country differentiated duopoly model is set out in which economic integration increases firms' incentives to invest in R&D, purely through the effect of increased intensity of competition between firms. The model is extended to incorporate knowledge spillovers, which, if related to the degree of integration, give rise to an inverted u-shaped relationship between R&D incentives and integration. The model is also extended to the n-firm general equilibrium case in which integration stimulates economic growth through intensity of competition. As such, the model suggests a positive growth effect of economic integration that does not rely on the usual scale effects.

Item Type: Monograph (Discussion Paper)
Related URLs:
Subjects: H Social Sciences > HB Economic Theory
Divisions : University Structure - Pre August 2011 > School of Social Sciences > Economics
ePrint ID: 33149
Accepted Date and Publication Date:
January 1999Made publicly available
Date Deposited: 21 Dec 2007
Last Modified: 27 Mar 2014 18:20

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