We take a differential game approach to study the optimal choices of managerial firms concerning efforts in product an process innovation. We find the Nash equilibria under the open-loop and closed-loop information structure, and we compare the steady state allocations with the corresponding equilibria of markets populated by standard profit-maximising firms. We find that the managerial incentive leads firm to underinvest in product differentiation and to overinvest in process innovation, as compared to standard profit-maximising firms.
Cellini R., Lambertini L. (2008). Product and Process Innovation in Differential Games with Managerial Firms. BINGLEY : Emerald Publishing [10.1016/S0573-8555(08)00209-5].
Product and Process Innovation in Differential Games with Managerial Firms
LAMBERTINI, LUCA
2008
Abstract
We take a differential game approach to study the optimal choices of managerial firms concerning efforts in product an process innovation. We find the Nash equilibria under the open-loop and closed-loop information structure, and we compare the steady state allocations with the corresponding equilibria of markets populated by standard profit-maximising firms. We find that the managerial incentive leads firm to underinvest in product differentiation and to overinvest in process innovation, as compared to standard profit-maximising firms.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
