R&D COOPERATION WITH UNIT-ELASTIC DEMAND |
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Authors: | Georg Gö tz, Anna Hammerschmidt&dagger |
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Affiliation: | Department of Economics, Justus-Liebig-University Giessen, Germany;, and Department of Economics, Vienna University of Economics and Business Administration, Austria |
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Abstract: | The present paper shows that R&D cooperation leads to the monopoly outcome in terms of price and quantity if demand is unit-elastic. If the demand function exhibits an upper bound for the willingness to pay, R&D cooperation is inferior to a scenario in which firms cooperate both in their R&D and their output decision. |
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Keywords: | cartelization R&D cooperation spillovers |
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