We examine a Stackelberg game where a financially constrainedleader faces competition from a ‘deep pocket’ follower. We …

-tournament R&D competition. We consider thatsuccess in R&D is uncertain. We show that whether firms invest more under … Cournotcompetition or Bertrand competition is ambiguous and depends on the probability ofsuccess in R&D but does not depend on the degree … of product differentiation. While‘static’ welfare is higher under Bertrand competition, we find that ‘dynamic’ welfare …

competition policy... …

¢ ciency undermild competition. The e¤ect of competition on the equilibrium strategy is di¤erentdepending on which class of … thatthe e¤ect of competition on e¢ ciency is di¤erent between the common value and theprivate value setting. Strong … competition leads to the least e¢ cient equilibrium forthe common value setting but e¢ ciency can be improved by competition in …

. It is shownthat more competition makes the equilibrium signaling more informative when thelevel of competition is … moderate. Moreover, the equilibrium signaling can perfectlyreveal the ability under a certain level of competition. On the …

induce excessive risk taking and make problemsolving slower (ii) prize schemes with milder competitive pressure induce the …

. At stagetwo, both players observe the given level of risk and simultaneouslyinvest in a winner-take-all competition. The …We analyze a two-stage game between two heterogeneous players.At stage one, common risk is chosen by one of the players … game is solved theoreticallyand then tested by using laboratory experiments. We find threeeffects that determine risk …