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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26013
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| Title: | Industry Size and the Distribution of R&D Investment |
| Authors: | Asker, John
Baccara, Mariagiovanna |
| Keywords: | Entry
Research and Development
Product Differentiation |
| Issue Date: | 8-Feb-2008 |
| Series/Report no.: | EC-08-05 |
| Abstract: | We analyze the link between industry size and R&D spending
distribution. We consider a monopolistically competitive market in which
firms can invest in cost-cutting R&D by paying a fixed cost first.
For an intermediate level of fixed cost, there is a unique equilibrium
in which the market segments into investing and non-investing firms.
Using this equilibrium, we study how the distribution and level of
R&D expenditure changes as industry size increases. In particular,
we show that, as the market size increases, R&D spending can become
more concentrated. Data motivating these results are drawn from the
Taiwanese and Korean semiconductor industries. |
| URI: | http://hdl.handle.net/2451/26013 |
| Appears in Collections: | Economics Working Papers
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