Endogenous R&D formations in a mixed triopoly under common ownership

This study investigates the impacts of common ownership in a mixed triopoly market and examines the role of private–public partnerships in the research and development (R&D) formations characterized by research joint ventures (RJVs). We compare different RJVs competition among private firms (pure partial RJV) or between private and public firms (mixed partial or full RJV). We find that common ownership decreases (increases) welfare under R&D competition or mixed partial RJV (under pure partial RJV or full RJV, respectively). We also find that in an endogenous agreement on RJV formation, full RJV can be agreed upon, which is socially desirable, whereas mixed partial RJV could be when the degree of common ownership is low. Our findings suggest that the government should promote private–public partnerships in R&D investments with higher common ownership.