Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

A Member of the Law Professor Blogs Network

Tuesday, November 9, 2010

Multi-market competition, R&D, and welfare in oligopoly

Posted by D. Daniel Sokol

Akio Kawasaki, Ming Hsin Lin, and Noriaki Matsushima (all The Institute of Social and Economic Research Osaka University) explain Multi-market competition, R&D, and welfare in oligopoly.

ABSTRACT: We investigate a multi-market Cournot model with strategic process R&D investments wherein a multi-market monopolist meets entrants that enter one of the markets. We find that entry can enhance the total R&D expenditure of the incumbent firm. That is, entry can stimulate R&D effort. Moreover, the incumbent's profit nonmonotonically changes as the number of entrants increases. Depending on the fixed entry costs and R&D technologies, both insufficient and excess entrycan appear.

http://lawprofessors.typepad.com/antitrustprof_blog/2010/11/multi-market-competition-rd-and-welfare-in-oligopoly.html

| Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef013488551da5970c

Listed below are links to weblogs that reference Multi-market competition, R&D, and welfare in oligopoly:

Comments

Post a comment