Less is more? Research Joint Ventures and Entry Deterrence


O'Sullivan, Paul (2013) Less is more? Research Joint Ventures and Entry Deterrence. Working Paper. UNSPECIFIED. (Unpublished)

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Abstract

This paper analyses the incentives of incumbent firms to form a first-mover RJV when faced with possible entry. If entry is accommodated, firms’ relative profits under R&D competition and RJV formation depend on R&D spillovers and firms’ R&D efficiency. RJV formation may make entry unprofitable if spillovers are sufficiently low. If entry is deterred, RJV formation may be more profitable. Similarly, whether accommodation or deterrence is more profitable under RJV formation depends on spillovers and the firms’ efficiency. How welfare is affected by RJV formation depends on whether output is exported or domestically consumed. There may be a role for active government policy to affect market outcomes.

Item Type: Monograph (Working Paper)
Keywords: Research Joint Ventures; Entry Deterrence;
Academic Unit: Faculty of Social Sciences > Economics, Finance and Accounting
Item ID: 4585
Depositing User: Ms Sandra Doherty
Date Deposited: 15 Nov 2013 15:56
URI:

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