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Collusion through Joint R&D: An Empirical Assessment

Referierte Aufsätze Web of Science

Tomaso Duso, Lars-Hendrik Röller, Jo Seldeslachts

In: The Review of Economics and Statistics 96 (2014), 2, S. 349-370

Abstract

This paper tests whether upstream R&D cooperation leads to downstream collusion. We show that a sufficient condition for identifying collusive behavior is a decline in the market share of RJV-participating firms. Using information from the U.S. National Cooperation Research Act, we estimate a market share equation correcting for the endogeneity of RJV participation and R&D expenditures. We find robust evidence that large networks between direct competitors - created through firms being members in several RJVs at the same time - are conducive to collusive outcomes in the product market which reduce consumer welfare. By contrast, RJVs among non-competitors are efficiency enhancing.

Jo Seldeslachts

Research Associate in the Firms and Markets Department

Tomaso Duso

Head of Department in the Firms and Markets Department



JEL-Classification: K21;L24;L44;D22;O32
DOI:
http://dx.doi.org/10.1162/REST_a_00367

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