Stability in the Patent Race Contest of Lee and Wilde

Posted: 21 Sep 1999

See all articles by Kofi O. Nti

Kofi O. Nti

Pennsylvania State University - Department of Supply Chain & Information Systems

Abstract

To determine how expenditure and profits vary with the number of firms in the patent race contest of Lee and Wilde, it is traditional to impose an ad-hoc stability condition on the best response function. This paper relates the stability condition to the standard myopic adjustment mechanism and shows that a concave hazard rate function with non-increasing hazard rate elasticity is sufficient for the analysis. We provide examples and reveal additional qualitative properties of the Lee and Wilde model.

JEL Classification: C62, O34

Suggested Citation

Nti, Kofi Opoku, Stability in the Patent Race Contest of Lee and Wilde. Available at SSRN: https://ssrn.com/abstract=176559

Kofi Opoku Nti (Contact Author)

Pennsylvania State University - Department of Supply Chain & Information Systems ( email )

Dept. of Supply Chain & Information Systems
University Park, PA 16802-3306
United States
814-863-2484 (Phone)

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