Technology policy and the organization of R&D

In this study we examine how technology policy in the form of R&D subsidies and encouragement of research joint ventures (RJVs) affects the investment incentives of firms in various types of imperfectly competitive markets. We find that joint ventures yield lower research intensities in the abse...

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Bibliographic Details
Published in:Journal of economic behavior & organization 1998-09, Vol.36 (4), p.503-520
Main Authors: Stenbacka, Rune, Tombak, Mihkel M.
Format: Article
Language:English
Subjects:
Economic incentives
Economic models
Imperfect competition
Investment
Investment decision
Joint ventures
Public interest
R&D
R&D subsidies
Research & development
Research and development
Research joint ventures
Studies
Subsidies
Technological planning
Technology policy
Welfare
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Summary:In this study we examine how technology policy in the form of R&D subsidies and encouragement of research joint ventures (RJVs) affects the investment incentives of firms in various types of imperfectly competitive markets. We find that joint ventures yield lower research intensities in the absence of subsidies. In the presence of optimal subsidy policy higher expected welfare is obtained with RJVs, but the optimal policy may also involve a more costly subsidy program. The analysis also identifies possible difficulties in implementing socially optimal policies arising from private incentives conflicting with the public interest.
ISSN:0167-2681
1879-1751
DOI:10.1016/S0167-2681(98)00108-5