University of Surrey

Test tubes in the lab Research in the ATI Dance Research

R&D Subsidies, Spillovers, and Privatization in Mixed Markets

Gil-Molto, MJ, Poyago-Theotoky, J and Zikos, V (2011) R&D Subsidies, Spillovers, and Privatization in Mixed Markets SOUTHERN ECONOMIC JOURNAL, 78 (1). 233 - 255. ISSN 0038-4038


Download (263kB)


We examine the use of subsidies to research and development (R&D) in a mixed and a private duopoly market. We show that the socially optimal R&D subsidy is increasing in the degree of spillovers, but it is lower in the private duopoly. The optimal R&D subsidy leads to an increase in total R&D and production; however, it does not lead to the equalization of per firm output and therefore to an efficient distribution of production costs. We also find that privatization of the public firm reduces R&D activity and welfare in the duopoly market. This result stands even when optimal R&D subsidies are provided.

Item Type: Article
Divisions : Faculty of Business, Economics and Law > Economics
Authors :
Poyago-Theotoky, JUNSPECIFIED
Date : 2011
Identification Number : 10.4284/0038-4038-78.1.233
Uncontrolled Keywords : Social Sciences, Economics, Business & Economics, DEVELOPMENT COMPETITION, OLIGOPOLY, DUOPOLY, SUBSIDIZATION
Related URLs :
Depositing User : Symplectic Elements
Date Deposited : 09 Jul 2012 13:02
Last Modified : 23 Sep 2013 19:22

Actions (login required)

View Item View Item


Downloads per month over past year

Information about this web site

© The University of Surrey, Guildford, Surrey, GU2 7XH, United Kingdom.
+44 (0)1483 300800