Cooperation in research and development
The work presented in this dissertation contributes both to the theoretical and the empirical literature on research joint ventures.
Firstly, I analyse the problem that in spite of the advantages mentioned above, research joint ventures do not always guarantee fruitful cooperation as partners may not deliver what is expected from them. Also, there are cases when firms do not start potentially very profitable RJVs. These failures can be due to the problem that firms cannot contract the transfer of the know-how and without the required amount of information disclosure the RJV is not profitable. This problem arises especially when firms are competitors either in the product market or in other R&D activities and therefore do not have the right incentives to share their knowledge. I propose a novel way to alleviate this problem. I show that firms can use their debt level as a commitment to disclose know-how. I find that there is a direct relationship between the debt of a firm and the incentives to disclose its know-how in a RJV. Moreover, I show conditions on the profit functions under which firms, in equilibrium, finance at least partially with debt. Due to the possibility of debt financing, the equilibrium level of disclosure is higher than in case of equity/internal financing. That is, the leverage acts as a commitment device to share knowledge. Hence, contracting on debt levels is sometimes a partial substitute of contracting on disclosure of know-how. Therefore, the possibility of debt financing is likely is improve welfare. I also present empirical evidence that firms with more leveraged financial structure are more likely to participate in horizontal research joint ventures.
In the second section of the thesis I provide a microeconometric analysis of the impact of RJV participation on productivity. Evaluating the overall benefits of cooperative research is very difficult because the cooperation may have an impact both on R&D spending and the competitive structure of the industry. Controling for this effects, I study the productivity implications of research joint venture participation using a large panel of European, Japanese and US companies. I find evidence that joint R&D increases productivity. I also find indirect evidence for cost sharing in horizontal research consortia.
Finally, I analyse the firms' incentives to engage in cooperative research. After conducting a simple investigation into general firm characteristics that are associated with RJV participation, the analysis mainly focuses on horizontal research joint ventures, i.e. when firms engage in cooperative research with their direct competitors. I find evidence for cost sharing in horizontal research joint ventures, which is consistent with the results of the theoretical literature.
Advisor:David Pérez Castrillo
School:Universitat Autónoma de Barcelona
Source Type:Master's Thesis
Keywords:412 departament d economia i historia economica
Date of Publication:06/29/2001