Subsidizing research programs with if and when uncertainty in the face of severe informational constraints

• 成果类型: Article
• 署名作者: Besanko, David; Tong, Jian; Wu, Jason Jianjun
• 署名单位: Northwestern University; University of Southampton
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/1756-2171.12227
• 发表日期: 2018
• 页码: 285-310
• 关键词: research-and-development; technology policy; spillovers; INNOVATION; duopoly; COOPERATION; venture; bandits

摘要

We study subsidy policies for research programs when firms have private information about the likelihood of project viability, but the government cannot form a unique prior about this likelihood. When the shadow cost of public funds is zero, first-best welfare can be attained as a (belief-free) ex post equilibrium under both monopoly and competition, but it cannot be attained when the shadow cost is positive. However, max-min subsidy policies exist under monopoly and competition and consist of pure matching subsidies. Under a Research and Development (R&D) consortium, the highest max-min matching rate is lower than under competition, and R&D investment intensity is higher.