We show the effects of Bertrand and Cournot competition on R&D investmentand social welfare in a duopoly with R&D competition where success in R&D isprobabilistic. We show that R&D investments are higher under Bertrand (Cournot)competition when R&D productivities are sufficiently low (high), and...

The contributory infringement rule assesses liability to a third party that contributes tothe infringement of a patent. Not only are firms that directly infringe liable, those whoindirectly contribute are also liable. We investigate how this rule affects the creation of anetwork of members...

Welfare in a two-product Cournot oligopoly is shown to increase (decrease) with an increase incorrelation between unit costs when the outputs complement (substitute) in demand. A morequalified correlation structure is required for the result to apply in a three-product Cournotoligopoly when...

It is usually believed that innovation increases profits of the firms and alsosocial welfare. In a duopoly model with product innovation, we show that both thesebelieve may go wrong. We show that if the cost of innovation is not very large,prisoner’s dilemma occurs under product innovation,...

Armchair evidence shows that many industries are made of a few big commercial ormanufacturing firms, which are able to affect the market outcome, and of a myriad of smallfamily-run businesses with very few employees, each of which has a negligible impact on themarket. Examples can be found in...

We consider the effects of product market cooperation on R&Dinvestment, profits, consumer surplus and welfare. We show that though R&Dinvestment, consumer surplus and social welfare may be higher or lower underproduct market cooperation than product market competition, industry profit isalways...

This paper compares Bertrand and Cournot equilibria in a horizontallydifferentiated duopoly market with non-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...

We introduce pollution, as a by-product of production, into a non-tournament model of R&Dwith spillovers. Technology policy takes the form of either R&D subsidisation or pre-competitiveR&D cooperation. We show that, when the emissions tax is exogenous, the optimal R&Dsubsidy can be negative,...

In the ICT sector, product-software is an important factor for the quality of the products (e.g. cell phones). In this context, open source software enables firms to avoid quality competition as they can cooperate on quality without an explicit contract. The economics of open source (OS) versus...

In the ICT sector, product-software is an important factor for the quality of the products (e.g. cell phones). In this context, open source software enables firms to avoid quality competition as they can cooperate on quality without an explicit contract. The economics of open source (OS) versus...