A Schumpeterian Model of Duopolistic Competition
Aim. This paper models the dynamics of technological change through the competitive interaction of two firms. The duopolists strive to outperform each other by exploiting the two fundamental Schumpeterian forces of economic development: innovation and imitation. method. By extending over a number of...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Financial University
2022-03-01
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| Series: | Review of Business and Economics Studies |
| Subjects: | |
| Online Access: | https://rbes.fa.ru/jour/article/view/181/182 |
| _version_ | 1797222115556982784 |
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| author | Guido Giacomo Preparata Giuliano Preparata |
| author_facet | Guido Giacomo Preparata Giuliano Preparata |
| author_sort | Guido Giacomo Preparata |
| collection | DOAJ |
| description | Aim. This paper models the dynamics of technological change through the competitive interaction of two firms. The duopolists strive to outperform each other by exploiting the two fundamental Schumpeterian forces of economic development: innovation and imitation. method. By extending over a number of periods a technological “limit-pricing model” (whereby the “learning-by-doing effect” is the source of the barrier to entry) and assuming that the two firms compete following one another in the role of innovator and imitator. As result, it is possible to trace out the paths followed by the market shares of both producers and to derive endogenously a unit cost curve characterizing the industry in the long run. conclusion. A further merit of the model presented herein is its representation of a “micro-macro transition phase” — viz., the passage from individual practice to industrial standard — through a simplified but, nonetheless, realistic depiction of behavioural routines. |
| first_indexed | 2024-04-24T13:16:12Z |
| format | Article |
| id | doaj.art-8f6f131b1f0c4b34bcf63bf9c4ea27d4 |
| institution | Directory Open Access Journal |
| issn | 2308-944X 2311-0279 |
| language | English |
| last_indexed | 2024-04-24T13:16:12Z |
| publishDate | 2022-03-01 |
| publisher | Financial University |
| record_format | Article |
| series | Review of Business and Economics Studies |
| spelling | doaj.art-8f6f131b1f0c4b34bcf63bf9c4ea27d42024-04-04T17:46:01ZengFinancial UniversityReview of Business and Economics Studies2308-944X2311-02792022-03-011012440https://doi.org/10.26794/2308-944X-2022-10-1-24-40A Schumpeterian Model of Duopolistic CompetitionGuido Giacomo Preparata0Giuliano Preparata1Pontifical Gregorian University in RomeUniversity of MilanAim. This paper models the dynamics of technological change through the competitive interaction of two firms. The duopolists strive to outperform each other by exploiting the two fundamental Schumpeterian forces of economic development: innovation and imitation. method. By extending over a number of periods a technological “limit-pricing model” (whereby the “learning-by-doing effect” is the source of the barrier to entry) and assuming that the two firms compete following one another in the role of innovator and imitator. As result, it is possible to trace out the paths followed by the market shares of both producers and to derive endogenously a unit cost curve characterizing the industry in the long run. conclusion. A further merit of the model presented herein is its representation of a “micro-macro transition phase” — viz., the passage from individual practice to industrial standard — through a simplified but, nonetheless, realistic depiction of behavioural routines.https://rbes.fa.ru/jour/article/view/181/182industrial organizationfirm behaviourinnovationimitationtechnologytechnological changeschumpeterdynamicslearning economiesparadigm shiftindustrial competitionduopoly |
| spellingShingle | Guido Giacomo Preparata Giuliano Preparata A Schumpeterian Model of Duopolistic Competition Review of Business and Economics Studies industrial organization firm behaviour innovation imitation technology technological change schumpeter dynamics learning economies paradigm shift industrial competition duopoly |
| title | A Schumpeterian Model of Duopolistic Competition |
| title_full | A Schumpeterian Model of Duopolistic Competition |
| title_fullStr | A Schumpeterian Model of Duopolistic Competition |
| title_full_unstemmed | A Schumpeterian Model of Duopolistic Competition |
| title_short | A Schumpeterian Model of Duopolistic Competition |
| title_sort | schumpeterian model of duopolistic competition |
| topic | industrial organization firm behaviour innovation imitation technology technological change schumpeter dynamics learning economies paradigm shift industrial competition duopoly |
| url | https://rbes.fa.ru/jour/article/view/181/182 |
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