Arbeitspapier

Managerial incentives, innovation and product market competition

This paper investigates the strategic value of the managerial incentive scheme in affecting firms' incentive in R&D investment and their product market activities. Firstly, we find that in Cournot-quantity competition, owners strategically assign a non-profit-maximization objective to their managers. Consequently, managers in a delegation game invest more in cost-reducing R&D, and have higher output, lower prices and lower profits, as compared to profit-maximizers in an owner-run game. Secondly, we find that R&D collusion induces owners in a delegation game to choose more aggressive managerial incentives as compared to R&D competition, which in turn leads to increased R&D investment, reduced product prices and increased profits.

Sprache
Englisch

Erschienen in
Series: DIW Discussion Papers ; No. 295

Klassifikation
Wirtschaft
Management of Technological Innovation and R&D
Firm Organization and Market Structure
Production and Organizations: General
Noncooperative Games
Thema
Strategic Delegation
Managerial Incentives
R&D competition and R&D collusion
Industrielle Forschung
Wettbewerb
Duopol
Führungskräfte
Leistungsanreiz
Vertrag
Anreizvertrag
Spieltheorie
Forschungskooperation
Theorie

Ereignis
Geistige Schöpfung
(wer)
Zhang, Zhentang
Ereignis
Veröffentlichung
(wer)
Deutsches Institut für Wirtschaftsforschung (DIW)
(wo)
Berlin
(wann)
2002

Handle
Letzte Aktualisierung
20.09.2024, 08:24 MESZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Zhang, Zhentang
  • Deutsches Institut für Wirtschaftsforschung (DIW)

Entstanden

  • 2002

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