Product and Process R&D under Asymmetric Demands - 10.1628/jite-2018-0015 - Mohr Siebeck
Economics

Yi-Jie Wang, Kung-Cheng Andy Wang, Wen-Jung Liang, Bo-Yi Lee

Product and Process R&D under Asymmetric Demands

Volume 175 () / Issue 3, pp. 537-557 (21)

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We develop a two-market model with asymmetric demands to examine the optimal product and process R&D under Bertrand and Cournot competition. We show that when the big market is sufficiently large and the cost parameter of product R&D is small or when the market is symmetric and the marginal disutility rate is high, the Cournot aggregate product R&D is greater than that under Bertrand competition. Next, when the big market is not sufficiently large and the cost parameter of product R&D is small, the Bertrand aggregate process R&D is greater than that under Cournot competition if the marginal disutility rate is low.
Authors/Editors

Yi-Jie Wang No current data available.

Kung-Cheng Andy Wang No current data available.

Wen-Jung Liang No current data available.

Bo-Yi Lee No current data available.