Abstract
We analyse economic welfare in R&D intensive industries under varying assumptions on the spillover process. The focus lies on spillover processes with complementary R&D investments such as those modelling absorptive capacity. There spillovers give rise to both negative and positive externalities. We show that the rationale for public policy intervention is strengthened where spillovers also have positive effects. This conclusion is based on the supermodularity of the spillover process and the investment game. We characterise a large class of spillover processes with similar implications for public policy. We show that results of much empirical work on absorptive capacity extend to this class of models.
Item Type: | Paper |
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Keywords: | spillovers, complementarity, absorptive capacity, supermodularity, oligopolistic R&D |
Faculties: | Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems > B2 - Wagniskapitalfinanzierte Unternehmen in Deutschland - Finanzierungskontrakte, Organisationsstrukturen und Eigentumsrechte |
Subjects: | 300 Social sciences > 330 Economics |
JEL Classification: | L13, O31 |
URN: | urn:nbn:de:bvb:19-epub-13519-6 |
Language: | English |
Item ID: | 13519 |
Date Deposited: | 10. Jul 2012, 13:11 |
Last Modified: | 04. Nov 2020, 12:53 |