Template-Type: ReDIF-Paper 1.0 Series: Tinbergen Institute Discussion Papers Creation-Date: 2000-09-14 Number: 00-075/1 Author-Name: Sanjeev Goyal Author-Email: firstname.lastname@example.org Author-Workplace-Name: Erasmus University Rotterdam Author-Name: Jose Luis Moraga Author-Email: email@example.com Author-Workplace-Name: Groningen University Title: R&D Networks Abstract: We develop a model of strategic networks that captures two distinctive features of interfirm collaboration: bilateral agreements and nonexclusive relationships. Our analysis highlights the relationship between market competition, firms' incentives to invest in R&D, and the architecture of collaboration networks. In the absence of firm rivalry, the complete network, where each firm collaborates with all others, is uniquely stable, industry-profit maximizing, and efficient. By contrast, under strong market rivalry the complete network is stable, but intermediate levels of collaboration and asymmetric networks are more attractive from a collective viewpoint. This suggests that competing firms may have excessive incentives to form collaborative links.
This discussion paper has resulted in a publication in The Rand Journal of Economics, 2001, 32(4), 686-707. Classification-JEL: D21; D43 Keywords: strategic alliances; networks; research and development File-Url: http://papers.tinbergen.nl/00075.pdf File-Format: application/pdf File-Size: 395043 bytes Handle: RePEc:tin:wpaper:20000075