Heterogeneous product and process innovations for a multi-product monopolist under finite life-cycles of production technologies.

Bondarev, Anton A. (2012): Heterogeneous product and process innovations for a multi-product monopolist under finite life-cycles of production technologies.

Abstract

Current paper analyses the influence of the length of production technologies life-cycles on the relative intensity of investments of a multi-product monopolist into different types of innovations. This monopolist is developing new versions of the basic product continuously and simultaneously invests into the production technologies of all these new products. In the paper the finite character of these products' life-cycles is assumed. These finite life-cycles are treated for the purposes of the paper as patents which are granted to the monopolist for the production and upgrading of every new product he/she introduces into the market. It is demonstrated that under the condition of finite-time life-cycles of new products the monopolist prefers to invest into process innovations for already introduced products rather than introducing the new ones in relative measure. It is argued, that this is not the case under infinite life-cycles for all these products where the monopolist invests relatively the same amounts into both types of innovations.

• Item Type: MPRA Paper
• Language: English
• Keywords: Heterogeneous Innovations; Economic Dynamics; Multiproduct Monopoly; Product Life-cycle; Distributed Control
• Subjects: L - Industrial Organization > L0 - General; C - Mathematical and Quantitative Methods > C0 - General > C02 - Mathematical Methods; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O31 - Innovation and Invention: Processes and Incentives

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