Co-opetition and Disruption With Public Ownership

52 Pages Posted: 19 Jan 2021 Last revised: 2 Nov 2021

See all articles by Arnoud W. A. Boot

Arnoud W. A. Boot

University of Amsterdam - Amsterdam Business School; Centre for Economic Policy Research (CEPR); Tinbergen Institute

Vladimir Vladimirov

University of Amsterdam Business School

Multiple version iconThere are 2 versions of this paper

Date Written: November 1, 2021

Abstract

Do mandatory disclosure requirements make public firms less disruptive and competitive? Not necessarily. We offer a new perspective showing that mandatory disclosure can facilitate cooperation among competing firms --- a strategy known as "co-opetition." Cooperation raises firms' profitability, which makes financing disruptive investments easier. Investment in marginally and very attractive investment opportunities increases. However, there is also a cost, as cooperation on existing technologies could erode the commitment to developing new ones. Intermediately attractive investments are affected the most, leading to underinvestment in such opportunities. We provide evidence from the enactment of stricter disclosure requirements supporting the model's predictions.

Keywords: co-opetition, cooperation, competition, public firms, public ownership, disruption, innovation

JEL Classification: G31, G32, L41, O31

Suggested Citation

Boot, Arnoud W. A. and Vladimirov, Vladimir, Co-opetition and Disruption With Public Ownership (November 1, 2021). Available at SSRN: https://ssrn.com/abstract=3741208 or http://dx.doi.org/10.2139/ssrn.3741208

Arnoud W. A. Boot

University of Amsterdam - Amsterdam Business School ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands
+31 20 525 4162 (Phone)
+31 20 525 5318 (Fax)

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

Vladimir Vladimirov (Contact Author)

University of Amsterdam Business School ( email )

Roetersstraat 18
Amsterdam, 1018WB
Netherlands

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