Munich Personal RePEc Archive

Output and R&D subsidies in a mixed oligopoly

Lee, Sang-Ho and Tomaru, Yoshihiro (2017): Output and R&D subsidies in a mixed oligopoly. Published in: Operations Research Letters No. 45 (April 2017): pp. 238-241.


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We analyze an oligopoly where public and private firms compete in quantity and R&D. Using general functions, we show that an output subsidy and an R&D tax can achieve the first-best allocation. Moreover, the degree of privatization does not influence the optimal output subsidy but does influence the optimal R&D tax.

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