The modelling of the relationship between innovation and competition through the theory of auction is simplistic. Researchers are re-evaluating previously tenuous assumptions in order to validate these thoughts for empirical use. However, the empirical verifications of this modelling remain...

This paper introduces a new type of R&D subsidy, which is conditional on the success of the R&D project. In a three-stage model, the government chooses a subsidy(ies), a monopolist chooses R&D effort which determines the size or the probability of success of the R&D project, and the firm chooses...