Research joint ventures: The role of financial constraints

Arbeitspapier

This paper provides a novel theory of research joint ventures for financially constrained firms. When firms choose R&D portfolios, an RJV can help to coordinate research efforts, reducing investments in duplicate projects. This can free up resources, increase the variety of pursued projects and thereby increase the probability of discovering the innovation. RJVs improve innovation outcomes when market competition is weak or external financing conditions are bad. An RJV may increase the innovation probability and nevertheless lower total R&D costs. RJVs that increase innovation also increase consumer surplus and tend to be profitable, but innovationreducing RJVs also exist. Finally, we compare RJVs to innovation-enhancing mergers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 416

Classification and Topics

• Classification: Wirtschaft ; Oligopoly and Other Imperfect Markets ; Contracting Out; Joint Ventures; Technology Licensing ; Innovation and Invention: Processes and Incentives
• Subject: Innovation ; Research Joint Ventures ; Financial Constraints ; Mergers ; Intensity of Competition ; Licensing

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Brunner, Philipp ; Letina, Igor ; Schmutzler, Armin
• Event: Veröffentlichung
• (who): University of Zurich, Department of Economics
• (where): Zurich
• (when): 2023

Further information

• DOI: doi:10.5167/uzh-219400
• Handle: http://hdl.handle.net/10419/275660
• Last update: 10.03.2025, 11:42 AM CET