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Loury (1979) - Market Structure And Innovation (view source)
Revision as of 18:50, 17 November 2010
, 18:50, 17 November 2010→Solution concept
However, this only defines the partial equilibrium. To complete the equilibrium we need to use the symmetry (which is also why the subscripts are dropped above):
:<math>a = \sum_{j \ne i} h(x_j) = (n-1)h(x^*)\;</math>
This equilibrium exists providing R&D is profitable absent rivalry (otherwise their may be a corner, not an internal solution).
