Knowledge as a public good:: efficient sharing and incentives for development effort

We consider Research-Development joint ventures where adverse selection arises in knowledge sharing, while there is moral hazard involved in the choice of private development efforts aimed at translating privately acquired and/or shared knowledge into valuable marketable innovations. We extend earlier work by Bhattacharya et al. [Bhattacharya, S., Glazer, J., Sappington, D., 1992. Licensing and the Sharing of Knowledge in Research Joint Ventures, J. Econ. Theory, Vol. 56, pp. 43-69.] to situations where one cannot identify a 'most knowledgeable' partner, by giving conditions under which there exist transfers implementing both efficient first best knowledge sharing and subsequent development efforts. (C) 1998 Elsevier Science S.A. All rights reserved.