We analyze games between two countries that use the tariff as a threat to induce each other to follow monetary policies equivalent to those that would obtain under a cooperative game. The analysis shows that under certain assumptions concerning the shares of tariff revenues that the countries...

We study the R&D performance of Cournot aligopolists. To this end we model a one-shot noncooperative game in which firms invest in R&D, with the aim of being first in an uncertain competition for a patentable cost-reducing innovation. The incentives to innovate are market profits and not...

Since the work of Schumpeter, it has been argued that there may exist a trade-off between static and dynamic efficiency. As a contribution to this debate, in this paper we compare the R&D performance of CCournot and Bertrand oligopolists. We model a one-shot noncooperative game in which firms...

In this paper we study a one-shot game of R&D between two price-setting firms that are asymmetrically placed as they produce at different cost levels. First we prove the existence and the properties of a noncooperative equilibrium. Then, we show that the higher (lower) the discount rate, the...

In this paper we study a one-shot game of R&D between two price-setting firms that are asymmetrically placed as they produce at different cost levels. The R&D technology displays increasing returns in the form of invisibilities. We show that there exists a unique equilibrium in pure strategies,...

We model a duopoly with a private and a public firm under the hypothesis of vertical product differentiation. Firms choose their quality levels first and then prices. We ask which firm will choose to serve the higher (lower) segment of the market. When firms act simultaneously in each stage,...

Without spillovers and under the "winner-take-all" hypothesis, there is overinvestment in R&D in a non cooperative equilibrium. This is due to the so-called "common pool problem", i.e., duplication of efforts. We show that a public firm can represent a useful instrument in the hands of a...