Long-run market configurations in a dynamic quality-ladder model with externalities
| Autor: | Mario Samano, Marc Santugini |
|---|---|
| Přispěvatelé: | Department of Economics, Northwestern University |
| Jazyk: | angličtina |
| Rok vydání: | 2020 |
| Předmět: |
Economics and Econometrics
050208 finance Control and Optimization Applied Mathematics media_common.quotation_subject 05 social sciences Investment (macroeconomics) Variety (cybernetics) [SHS]Humanities and Social Sciences Product (business) Market structure 0502 economics and business Economics Econometrics Probability distribution Quality (business) 050207 economics Lagging Externality media_common |
| Zdroj: | Journal of Economic Dynamics and Control Journal of Economic Dynamics and Control, Elsevier, 2020, 117, pp.103943-. ⟨10.1016/j.jedc.2020.103943⟩ |
| ISSN: | 0165-1889 |
| DOI: | 10.1016/j.jedc.2020.103943⟩ |
| Popis: | We study the impact of standard-setting by introducing an externality that increases product compatibility in the presence of asymmetric returns to investment in a dynamic quality-ladder-type model. We classify the long-run, multi-modal probability distributions over different market structures that arise from this model. In some cases, the lagging firm may remain in the market in the long-run depending on the strength of the externality. In the case where only the laggard invests in compatibility, it is possible that the laggard becomes a monopolist if the leader has a relatively low R&D capability and the two firms are almost symmetric in this same regard. This variety of multi-modal long-run distributions may have important consequences for the estimation and the simulation of this class of dynamic models. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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