Licensing endogenous cost-reduction in a differentiated Stackelberg model

Ferreira, Flávio; Bode, Oana R.

http://hdl.handle.net/10400.22/3181

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Authors

Ferreira, Flávio

Bode, Oana R.

Abstract(s)

In this paper we consider a differentiated Stackelberg model, when the leader firm engages in an R&D process that gives an endogenous cost-reducing innovation. The aim is to study the licensing of the cost-reduction by a two-part tariff. By using comparative static analysis, we conclude that the degree of the differentiation of the goods plays an important role in the results. We also do a direct comparison between our model and Cournot duopoly model.

Keywords

Game theory Industrial organization Optimization Stackelberg model R&D investments Licensing

URI

http://hdl.handle.net/10400.22/3181

Citation

Ferreira, F., & Bode, O. R. (2013). Licensing endogenous cost-reduction in a differentiated Stackelberg model. Communications in Nonlinear Science and Numerical Simulation, 18(2), 308 – 315. DOI:10.1016/j.cnsns.2012.07.001