Process and Product Innovation by a Multiproduct Monopolist: A Dynamic Approach

Arbeitspapier

We model the optimal behaviour of a multiproduct monopolist investing both in process and in product innovation in a dynamic setting. Product innovation reduces the degree of substitutability between any two varieties. First, we find that R&D efforts increase in both directions as the number of varieties grows. Second, we characterise the relative intensity of R&D activities according to the reservation price and the interaction between the number of varieties and the degree of product differentiation. Finally, we show the existence of complementarity within the R&D portfolio, i.e., decreasing marginal production cost prompts for an analogous reduction of product substitutability, and conversely

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Quaderni - Working Paper DSE ; No. 551

Classification and Topics

• Classification: Wirtschaft
• Subject: Innovation ; Technischer Fortschritt ; Mehrproduktfertigung ; Vertikale Integration ; Produktdifferenzierung ; Monopol ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Lambertini, Luca ; Mantovani, Andrea
• Event: Veröffentlichung
• (who): Alma Mater Studiorum - Università di Bologna, Dipartimento di Scienze Economiche (DSE)
• (where): Bologna
• (when): 2005

Further information

• DOI: doi:10.6092/unibo/amsacta/4738
• Handle: http://hdl.handle.net/10419/159392
• Last update: 10.03.2025, 11:42 AM CET