Abstract
Comparing the effect on private R&D investments of allowing firms to cooperate in R&D with that of providing R&D subsidies reveals that in general the latter policy is more effective than the former in promoting R&D activity. Analyzing the implementation of both policies simultaneously reveals that subsidizing cooperative and noncooperative R&D leads to the same market outcome. The preferred R&D-stimulating policy is to subsidize optimally an agreement according to which firms only share the outcomes of their independent research.
| Original language | English |
|---|---|
| Pages (from-to) | 151-175 |
| Number of pages | 25 |
| Journal | Journal of economics |
| Volume | 66 |
| Issue number | 2 |
| DOIs | |
| Publication status | Published - 1997 |
| Externally published | Yes |
Keywords
- research and development
- subsidies
- cooperation
- Cournot duopoly
- spillovers
- COMPETITION
- VENTURES
- POLICY
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