A Model of Endogenous Market Structure, Innovation, and Licensing in Agricultural Biotechnology

We develop a model of endogenous market structure and sunk cost R&D investment that allows for the licensing of technology among competitors. Our theoretical model predicts both a greater lower bound to market concentration and higher levels of quality compared to the case without licensing. These result simply that in markets in which licensing and a symmetric R&D costs are prevalent, such as the agricultural biotechnology sector, the ability to license technology generates more concentration among firms but also improves consumer welfare by incentivizing the production of higher quality.


Issue Date:
2010
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/61786
Total Pages:
1
Series Statement:
Selected Poster
11867




 Record created 2017-04-01, last modified 2017-08-25

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)