Preemptive Search and R&D Clustering

RAND Journal of Economics, Summer 1998

Posted: 8 Jul 1998

See all articles by James Cardon

James Cardon

Princeton University - Department of Economics

Dan Sasaki

University of Exeter Business School

Abstract

While many preceding studies discuss the equilibrium intensity of R&D, this article focuses on its equilibrium direction. There can be a pure-strategy equilibrium in which multiple firms "cluster," i.e., attempt to develop the same technology even if (i) potential technologies are ex ante equally promising, (ii) each technology can be patented by no more than one firm, and (iii) there are no informational spillovers among firms. Economic applications of this clustering result are not confined to R&D. Any situation where agents are racing in search of exclusive economic opportunities can be an example of this model.

JEL Classification: L11, L15

Suggested Citation

Cardon, James H. and Sasaki, Dan, Preemptive Search and R&D Clustering. RAND Journal of Economics, Summer 1998, Available at SSRN: https://ssrn.com/abstract=105708

James H. Cardon (Contact Author)

Princeton University - Department of Economics ( email )

Princeton, NJ 08544-1021
United States

Dan Sasaki

University of Exeter Business School ( email )

Department of Economics
Exeter, Devon EX4 4PU
United Kingdom
(44) 1392 263242 (Fax)

HOME PAGE: http://www.ex.ac.uk/~dsasaki

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