To Reveal or Not to Reveal - the Case of Research Joint Ventures with Two-Sided Incomplete Information

GEABA - Discussion Paper No. 00-06

17 Pages Posted: 28 May 2002

See all articles by Stephanie Rosenkranz

Stephanie Rosenkranz

Utrecht University - School of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: 2000

Abstract

Firms' incentives to form RJVs are analyzed in an incomplete information framework when technological know-how is private information. Firms first decide on cooperation and then compete for a patent in a second price auction. Provided that firms have to indicate their willingness to cooperate by revealing a fraction of their knowhow it can be shown that non-cooperation is always an equilibrium. If this fraction is sufficiently low cooperation can also occur in equilibrium. For intermediate levels of know-how revelation there exists an equilibrium in which only firms with low know-how cooperate.

Keywords: Research joint ventures, incomplete information, spillovers, second-price auction

JEL Classification: O31, L13, D82

Suggested Citation

Rosenkranz, Stephanie, To Reveal or Not to Reveal - the Case of Research Joint Ventures with Two-Sided Incomplete Information (2000). GEABA - Discussion Paper No. 00-06, Available at SSRN: https://ssrn.com/abstract=310085 or http://dx.doi.org/10.2139/ssrn.310085

Stephanie Rosenkranz (Contact Author)

Utrecht University - School of Economics ( email )

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