A Note on Capital Commitment and Cournot Competition with Labour-Managed and Profit-Maximising Firms

This paper shows that the discussion of Lambertini and Rossini (1998) as to the strategic investment levels oflabour-managed firms in a labour-managed (LM) duopoly is misleading. This is due to the fact that there is no duality between the conditions for maximisation and minimisation, and what is worse, an equilibrium needed for comparison is interior when the investment behaviour of the firms is discussed along the conventional method. We reconsider whether they overinvest or underinvest in R&D, employing a more general model with R&D spillovers. It is demonstrated that results obtained in the LM duopoly are similar to those in a conventional duopoly of profit-maximising firms.

研究ノート (Note)