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On the Prisoner’s Dilemma in R&D with Input Spillovers and Incentives for R&D Cooperation

Burr, Chrystie, Knauff, Malgorzata, Stepanova, Anna (2013) On the Prisoner’s Dilemma in R&D with Input Spillovers and Incentives for R&D Cooperation. Mathematical Social Sciences, 66 (3). pp. 254-261. ISSN 0165-4896. (doi:10.1016/j.mathsocsci.2013.05.004) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided)

The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided. (Contact us about this Publication)
Official URL
http://dx.doi.org/10.1016/j.mathsocsci.2013.05.004

Abstract

This paper considers a standard model of strategic R&D with spillovers in R&D inputs, and extends the result that duopoly firms engaged in a standard two-stage game of R&D and Cournot competition end up in a prisoner’s dilemma situation for their R&D decisions, whenever spillover effects and R&D costs are relatively low. In terms of social welfare, this prisoner’s dilemma always works to the advantage of both consumers and society. This result allows a novel and enlightening perspective on some issues of substantial interest in the innovation literature. In particular, the incentive firms face towards R&D cooperation in the form of an R&D cartel is shown to be maximal for the case of zero spillovers, which is when the prisoner’s dilemma has the largest scope.

Item Type: Article
DOI/Identification number: 10.1016/j.mathsocsci.2013.05.004
Additional information: In press; number of additional authors: 2;
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Stewart Brownrigg
Date Deposited: 07 Mar 2014 00:05 UTC
Last Modified: 01 Aug 2019 10:37 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/40246 (The current URI for this page, for reference purposes)
Stepanova, Anna: https://orcid.org/0000-0003-1965-842X
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