Conplementarities and commitment in a Cournot setting


  • Manel Antelo Universidad de Santiago de Compostela



R&D, cost reduction


When oligopolistic firms compete by investing simultaneously in cost-reducing R&D and in demand-creating advertising expenditures, their strategic commitment in such assets may differ qualitatively from the behavior pursued when only one of them is used. In particular, if R&D (and advertising) investment is decided on and made public before selecting the output, then cases of under commitment in cost reduction can arise despite the non-existence of technological spillovers; and others in which there is no room for a differentiated strategic use of R&D. Furthermore, when advertising is included among the investment variables of firms, their R&D expenses may equal or even exceed the socially optimal level.


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How to Cite

Antelo, M. (2002). Conplementarities and commitment in a Cournot setting. Estudios Económicos De El Colegio De México, 17(1), 3–36.

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