search query: @author Banerjee, S. / total: 7
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| Author: | Banerjee, S. Lin, P. |
| Title: | Vertical research joint ventures |
| Journal: | International Journal of Industrial Organization
2001 : JAN, VOL. 19:1-2, p. 285-302 |
| Index terms: | R&D JOINT BUSINESS VENTURES COSTS |
| Language: | eng |
| Abstract: | The authors examine the incentives of firms to form vertical research joint ventures (RJVs) which enable an upstream supplier to internalize the positive externality of its innovation on a downstream market, while giving the downstream members a cost advantage over their non- member rivals. Under the cost-sharing rules considered, the upstream member desires a larger RJV compared to the downstream members. R&D subsidies may be detrimental to social welfare. The optimal RJV size for the upstream (downstream) member decreases (increases) with R&D cost and increases (decreases) with the gains from innovation and the size of market. An increase in upstream competition has the effect of enlarging the optimal RJV. |
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