Direction of Innovation

Bryan, Kevin; Lemus, Jorge

doi:10.2139/ssrn.2341381

Cited by 15 publications

(22 citation statements)

References 5 publications

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“…Despite this, we show that aggregate investment in the less profitable project increases and consumer welfare may improve post-merger. 9 We derive a clear policy message: in the absence of any synergies, when the relatively less profitable project is also the relatively less appropriable, a merger raises consumer surplus by increasing investment in it. Otherwise, if the project that is relatively more and is known as the Colonel Blotto game.…”

Section: Introductionmentioning

confidence: 95%

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Mergers and Innovation Portfolios

González

Motchenkova²,

Nevrekar

2019

SSRN Journal

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This paper studies mergers in markets where firms invest in a portfolio of research projects of different profitability and social value. The portfolio nature of the investment problem brings about novel insights on the external effects of firms' investments. The investment of a firm in one project imposes a negative business-stealing externality on the rival firms because it lowers the probability they win the innovation contest for that project; however, the investment of a firm in one project also exerts a positive business-giving externality on the rival firms because it increases the likelihood they win the contest for the alternative project. Merging firms internalize these positive and negative externalities they impose on each other. We show that when the project that is relatively more profitable for the firms is also the more appropriable, then a merger increases consumer welfare by reducing investment in the most profitable project and increasing investment in the alternative (less profitable) project. For the case of linear demand and constant marginal costs, the portfolio effect of mergers makes them consumer welfare improving. With constant elasticity of demand and constant marginal costs, a merger increases consumer welfare if the more profitable project corresponds to the market with the higher elasticity of demand. The portfolio effect of mergers may dominate the usual market power effects of mergers.

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Section: Introductionmentioning

confidence: 95%

“…The total investment of the merged entity into the B -innovation path is then 2´x m . Non-merging firms continue to maximize the payoff in(9).…”

mentioning

confidence: 99%

Mergers and Innovation Portfolios

González

Motchenkova²,

Nevrekar

2019

SSRN Journal

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“…In what follows we discuss the implications of Theorem 1 in the setup of an innovation contest (e.g., Che & Gale, 2003;Adamczyk et al, 2012;Erat & Krishnan, 2012;Bryan & Lemus, 2017;Letina & Schmutzler, 2019;Mihm & Schlapp, 2019;Matros et al, 2019), in which a contest designer, who wishes to maximize the social payoff, might influence the private payoffs of players by offering a monetary reward to the prize's finder, which is added to the finder's private value.…”

Section: Insights For Innovation Contestsmentioning

confidence: 99%

“…These situations (henceforth, search games) are common in various important areas such as R&D races in oligopolistic markets (e.g., Loury et al, 1979;Fershtman & Rubinstein, 1997;Chatterjee & Evans, 2004;Konrad, 2014;Akcigit & Liu, 2015;Letina, 2016;Liu & Wong, 2019), design of innovation contests (e.g., Che & Gale, 2003;Adamczyk et al, 2012, Erat & Krishnan, 2012Bryan & Lemus, 2017;Letina & Schmutzler, 2019;Mihm & Schlapp, 2019;Matros et al, 2019), pharmaceutical research (e.g., Matros & Smirnov, 2016;de Roos et al, 2018), academic research (e.g., Kleinberg & Oren, 2011), and product design within a firm (e.g., Loch et al, 2001). Most of the existing literature assumes that all agents have symmetric information regarding the prize's location.…”

Section: Introductionmentioning

confidence: 99%

Social Welfare in Search Games with Asymmetric Information

2020

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We consider games in which players search for a hidden prize, and they have asymmetric information about the prize's location. We study the social payoff in equilibria of these games. We present sufficient conditions for the existence of an equilibrium that yields the first-best payoff (i.e., the highest social payoff under any strategy profile), and we characterize the first-best payoff. The results have interesting implications for innovation contests and R&D races.

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“…The articles by Kapetaniou (2018), Lanahan andFeldman (2015), van Rijnsoevera et al (2015), Padilla-Pé rez and Gaudin (2014), Liu et al (2011) analyze national innovation systems, which focus on improving the efficiency of innovation activities by expanding the availability of financial instruments and their accessibility to entrepreneurs. Bryan and Lemus (2017), Borrá s and Edquist (2013), Nill and Kemp (2009) in their works examine various types of innovation policy tools. Klochikhin (2012) believes that over the past twenty years, Russia has struggled to become an effective market economy.…”

Section: Introductionmentioning

confidence: 99%

Strategic Planning and Management of High-Tech Developments and Innovative Technical Solutions

Новиков¹,

Amirova²,

Kosykh³

et al. 2019

RWE

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The innovation-oriented activity of enterprises is vital to the formation of competitive positions of the national economy on the world scene. Moreover, the importance of innovation is due to the complex modern economic conditions. Because of the sanctions from developed countries, it is necessary to increase production activities within the country in order to meet domestic demand, as well as to improve cooperation with the countries of the Eurasian Economic Union and Southeast Asia. The study focuses on strategic planning and management of high-tech developments and innovative technical solutions. The authors predicted the financing of science in Russia until 2030. The paper uses comparative analysis, systematization, induction, and deduction. Russia has developed a positive trend in financing the R&D sphere until 2030, which will improve its position in the global competitiveness rating. These findings can be used by managers of enterprises with innovation activities, by authorities regulating innovation activities in Russia, and by specialists in the field of innovation.

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Direction of Innovation

Cited by 15 publications

References 5 publications

Mergers and Innovation Portfolios

Mergers and Innovation Portfolios

Social Welfare in Search Games with Asymmetric Information

Strategic Planning and Management of High-Tech Developments and Innovative Technical Solutions

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