Big companies and small innovation factories possess different advantages in a patent contest. While large firms typically have a better access to product markets, small firms often have a superior R&D efficiency. In this paper I model a patent contest with asymmetric firms. In a pre-contest...

We consider mergers in an innovation contest between n firms in the presence of synergetic effects. We assume that a merger may affect the R&D efficiency of the merging firm due to increasing returns to scale in R&D. We show that mergers are beneficial for the merging firms even if the...

This chapter reviews the empirical literature on the determination of firms’ and industries’ innovative activity and performance, highlighting the questions addressed, the approaches adopted, impediments to progress in the field, and research opportunities. We review the...

This paper presents a duopoly model of e-business technology adoption. A leader and a follower benefit from a new e-business technology with uncertain quality depending on its innovation and adoption cost and both firms' adoption timing. When innovation and adoption require large set-up costs,...

This paper presents a model of sequential innovation in which industry structure is endogenous and a standard of patentability determines the proportion of all inventions that qualify for protection (in U.S. patent law this standard is called nonobviousness; in Europe it is called the inventive...

We construct and estimate a dynamic oligopoly model of the Bitcoin mining market. Mining equipment manufacturers produce differentiated durable capital goods and endogenously choose optimal investments in R&D. Miners make dynamic purchase decisions based partly on beliefs regarding...

We examine the geographic co-location of university research and industrial R&D in three technology areas. While we find strong evidence of co-location of these vertically connected activities, regional economies appear to vary markedly in their ability to convert local academic research into...

The goal of this paper is to present a formal model of firm innovation that simultaneously analyzes innovation factors characteristic to the Schumpeterian strand of industrial organization literature and the know-how strand. Corporate R&D intensity serves here as an input measure of firm...

This paper examines empirically the relationship between innovation and market structure within a simultaneous framework at the industry level of aggregation. We use a model in which R&D affects both, demand and cost conditions. An optimization process leads to optimal industry R&D expenditure...