Details
| Original language | English |
|---|---|
| Pages (from-to) | 419-433 |
| Number of pages | 15 |
| Journal | Journal of Economics and Management Strategy |
| Volume | 10 |
| Issue number | 3 |
| Publication status | Published - 2001 |
| Externally published | Yes |
Abstract
This paper explores a dynamic model of product innovation, extending the work of Dutta, Lach, and Rustichini (1995). It is shown that if R&D costs for quality improvements are low, the dynamic competition is structured as a race for being the pioneer firm with payoff equalization in equilibrium, but switches to a waiting game with a second-mover advantage in equilibrium if R&D costs are high. Moreover, the second-mover advantage increases monotonically as R&D becomes more costly.
ASJC Scopus subject areas
- Business, Management and Accounting(all)
- General Business,Management and Accounting
- Economics, Econometrics and Finance(all)
- Economics and Econometrics
- Business, Management and Accounting(all)
- Strategy and Management
- Business, Management and Accounting(all)
- Management of Technology and Innovation
Sustainable Development Goals
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In: Journal of Economics and Management Strategy, Vol. 10, No. 3, 2001, p. 419-433.
Research output: Contribution to journal › Article › Research › peer review
}
TY - JOUR
T1 - Second-mover advantages in dynamic quality competition
AU - Hoppe, Heidrun C.
AU - Lehmann-Grube, Ulrich
PY - 2001
Y1 - 2001
N2 - This paper explores a dynamic model of product innovation, extending the work of Dutta, Lach, and Rustichini (1995). It is shown that if R&D costs for quality improvements are low, the dynamic competition is structured as a race for being the pioneer firm with payoff equalization in equilibrium, but switches to a waiting game with a second-mover advantage in equilibrium if R&D costs are high. Moreover, the second-mover advantage increases monotonically as R&D becomes more costly.
AB - This paper explores a dynamic model of product innovation, extending the work of Dutta, Lach, and Rustichini (1995). It is shown that if R&D costs for quality improvements are low, the dynamic competition is structured as a race for being the pioneer firm with payoff equalization in equilibrium, but switches to a waiting game with a second-mover advantage in equilibrium if R&D costs are high. Moreover, the second-mover advantage increases monotonically as R&D becomes more costly.
UR - http://www.scopus.com/inward/record.url?scp=0035615462&partnerID=8YFLogxK
U2 - 10.1111/j.1430-9134.2001.00419.x
DO - 10.1111/j.1430-9134.2001.00419.x
M3 - Article
AN - SCOPUS:0035615462
VL - 10
SP - 419
EP - 433
JO - Journal of Economics and Management Strategy
JF - Journal of Economics and Management Strategy
SN - 1058-6407
IS - 3
ER -