a Differential R & D Duopoly Game
At each date, the two players play an R & D investment game "followed" by a Cournot quantity setting game. Each player's R & D augments the common stock of technical knowledge and lowers goods production costs for each player. Profit gross of R & D investment expenditures are quadratic in the state (knowledge here) for each player. R & D investment costs are assumed quadratic in each player's investment. The Nash feedback and Nash open-loop solutions differ in general with the feedback solution being "more competitive", i.e., yielding lower production costs in the steady state.
Year of publication: |
1992-07
|
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Authors: | Hartwick, John M. |
Institutions: | Economics Department, Queen's University |
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