The evolution of R&D networks
The evolution of R&D networks
We study the evolution of R&D networks in a Cournot model where firms may lower marginal costs due to bilateral R&D collaborations. Stochastically stable R&D networks exhibit the dominant group architecture, and, contrary to the existing literature, generically unique predictions about the size of the dominant group can be obtained. This size decreases monotonically with respect to the cost of link formation and there exists a lower bound on the size of the dominant group for non-empty networks. Stochastically stable networks are always inefficient and an increase in linking costs has a non-monotone effect on average industry profits.
R&D networks, Stochastic stability, Oligopoly
158-172
Dawid, Herbert
dbea80f8-27b6-4487-a95e-6579410c6370
Hellmann, Tim
e03b4edd-3010-4f6d-831e-86e4b3d6cbe0
September 2014
Dawid, Herbert
dbea80f8-27b6-4487-a95e-6579410c6370
Hellmann, Tim
e03b4edd-3010-4f6d-831e-86e4b3d6cbe0
Dawid, Herbert and Hellmann, Tim
(2014)
The evolution of R&D networks.
Journal of Economic Behavior & Organization, 105, .
(doi:10.1016/j.jebo.2014.03.004).
Abstract
We study the evolution of R&D networks in a Cournot model where firms may lower marginal costs due to bilateral R&D collaborations. Stochastically stable R&D networks exhibit the dominant group architecture, and, contrary to the existing literature, generically unique predictions about the size of the dominant group can be obtained. This size decreases monotonically with respect to the cost of link formation and there exists a lower bound on the size of the dominant group for non-empty networks. Stochastically stable networks are always inefficient and an increase in linking costs has a non-monotone effect on average industry profits.
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Accepted/In Press date: 2 March 2014
e-pub ahead of print date: 6 May 2014
Published date: September 2014
Keywords:
R&D networks, Stochastic stability, Oligopoly
Identifiers
Local EPrints ID: 435698
URI: http://eprints.soton.ac.uk/id/eprint/435698
ISSN: 0167-2681
PURE UUID: 1dfcf2c5-5262-4053-9924-82e1c3401701
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Date deposited: 18 Nov 2019 17:30
Last modified: 16 Mar 2024 04:54
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Author:
Herbert Dawid
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