Adoption and Diffusion of Cost Reducing Innovations: Cournot Competition in Duopoly

CORE Discussion Paper No. 2004/85

13 Pages Posted: 15 Apr 2005

See all articles by Raouf Boucekkine

Raouf Boucekkine

Universite Catholique de Louvain

Omar Licandro

European University Institute - Economics Department (ECO)

Antonio Minniti

University of Bologna

Date Written: December 2004

Abstract

This note analyses the adoption and diffusion of innovations in a horizontally differentiated Cournot duopoly in which firms have to choose the dates for adopting a cost-reducing new technology like in Reinganum (1981a). We prove that product differentiation crucially matters in the diffusion pattern of the innovation and in the comparison between the adoption timing in the decentralized economy Vs the social optimum.

Keywords: adoption, diffusion, differentiated duopoly

JEL Classification: O31

Suggested Citation

Boucekkine, Raouf and Licandro, Omar and Minniti, Antonio, Adoption and Diffusion of Cost Reducing Innovations: Cournot Competition in Duopoly (December 2004). CORE Discussion Paper No. 2004/85, Available at SSRN: https://ssrn.com/abstract=688905 or http://dx.doi.org/10.2139/ssrn.688905

Raouf Boucekkine (Contact Author)

Universite Catholique de Louvain ( email )

3, Place Montesquieu
Institut de Recherches Economiques et Sociales (IRES)
1348 Louvain-la-Neuve
Belgium
+32 10 47 38 48 (Phone)
+32 10 47 39 45 (Fax)

Omar Licandro

European University Institute - Economics Department (ECO) ( email )

Villa San Paolo
Via della Piazzuola 43
50133 Florence
Italy
+39 055 46 85 953/954 (Phone)
+39 055 46 85 902 (Fax)

HOME PAGE: http://www.iue.it/Personal/Licandro/Welcome.html

Antonio Minniti

University of Bologna ( email )

Piazza Scaravilli 2
Bologna, 40100
Italy

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