Essays on technological change and innovation games

The objectives of this dissertation is to provide a theory of innovation and technological change incorporating the following aspects; (i) the impact of the existence of substitutes and complements on the innovation incentives in presence of technological externalities, in a Cournot Nash game theoretic framework. Process innovation theory has focused predominantly on changes in the production possibility set of industrial structures producing homogenous goods. Indeed, firms are assumed to produce identical goods at the same fixed marginal cost. However, one argue that in such case having more than a single firm serving the market leads likely to a social waste in term of fixed cost, and hence the monopolization of the industry prevents a wasteful duplication of fixed costs. (ii) the influence of increasing marginal costs production technologies on the innovation and production behavior for finite size industries as well for competitive market structures, using an n-firm Cournot Nash game. It is shown that as more firms are added to the market the rate of private innovation decreases. Furthermore, the market solution is asymptotically efficient in absence of spillovers. This result however does not hold for a finite size industry. In the presence of significant spillovers, the market solution diverges from the socially desirable level and the rate of divergence depends positively on the magnitude of the spillovers parameter. (iii) cooperation versus noncooperation in research and development in presence of spillovers in the case of industrial structures which are not necessarily homogenous. Findings support the theory that both the noncooperative and the cooperative solution do not yield the socially desired innovative effort. It is shown also that the idea cooperative induces in aggregate more innovation effort than in the noncooperation case, depends on the production structure as captured by the degree of heterogeneity.

Name thesis:degree_name

Ph.D.

Level thesis:degree_level

Dissertation

Discipline thesis:degree_discipline

Economics

Grantor

University of Illinois at Urbana-Champaign

Year dc:date

2011

Author dc:creator

• Mansouri, Faysal

Contributors dc:contributor

• Rashid, Salim

• Economics, Theory

Statement dc:rights

• Copyright 1992 Mansouri, Faysal

Language dc:language

eng

Identifier

AAI9305612
(UMI)AAI9305612

OAI identifier oai:identifier

oai:www.ideals.illinois.edu:2142/20526