Strategic Alliances: Opportunities for Innovations and Effects on Competition

Student: Malykh Sofya

Educational Programme: Applied Economics (Master)

Year of Graduation: 2016

This study is dedicated to the question, what effects associated with what factors should be taken into account when assessing the integral effect of research strategic alliances on competition. R&D sphere characteristics can greatly affect society’s attitude to desire of companies to cooperate. Although the problem of the influence of strategic alliances on competition is extensively covered by various authors, there are few works investigating the effect of R&D cooperation on social welfare in general. This paper proposes an original model based on preconditions that are rarely used in modelling of strategic alliances. I assume that the contract includes development of a specific project and bringing to market a new product, and that investment processes in companies are asymmetric. Using my model, I find out that hypothetically, there are circumstances in which strategic alliance may be favorable for the society even if it helps companies to collude.

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