Downstream R&D, raising rivals' costs, and input price contracts

被引：57

作者：

Banerjee, S

Lin, P ^{[1
]}

机构：

[1] Lingnan Univ, Dept Econ, Tuen Mun, Hong Kong, Peoples R China

[2] Georgia Inst Technol, Sch Econ, Atlanta, GA 30332 USA

来源：

INTERNATIONAL JOURNAL OF INDUSTRIAL ORGANIZATION | 2003年 / 21卷 / 01期

关键词：

vertical R&D; raising rivals' cost; fixed-price contract;

D O I：

10.1016/S0167-7187(02)00010-3

中图分类号：

F [经济];

学科分类号：

02 ;

摘要：

We analyze the incentives for cost-reducing R&D by downstream firms in a two-tier market structure. By increasing the demand for an input, downstream R&D allows the upstream firm to raise its input price. This lowers the benefit of R&D to a downstream firm but raises its rivals' costs. As a result, a downstream oligopolist may invest more in R&D than a downstream monopolist, a phenomenon that is absent in a purely horizontal R&D setting. Fixed-price agreements (where the input price remains unchanged following downstream R&D) promote innovation by eliminating the opportunistic behavior of the input supplier and are welfare enhancing. (C) 2003 Elsevier Science B.V. All rights reserved.

引用

页码：79 / 96

页数：18

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