Econ 483_Lecture 21_Public provision

Politicians may be penalized in the media for failure

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Unformatted text preview: that are risky and lengthy t There is a knowledge gap between policy makers and universities. Politicians may be penalized in the media for failure. Lecture 21: Public Support of R&D, Econ483: Econ of Innovation & Technology, Evangelia Chalioti c A ll rights reserved. Problems with federal R&D record Government is more likely to favor projects that are classic public goods. e.g. military projects Health research Basic research Problem: risky and lengthy! Lecture 21: Public Support of R&D, Econ483: Econ of Innovation & Technology, Evangelia Chalioti c A ll rights reserved. G ross domestic expenditure on R&D (as % of GDP); From: OECD Factbook 2011-2012 Lecture 21: Public Support of R&D, Econ483: Econ of Innovation & Technology, Evangelia Chalioti c A ll rights reserved. L ecture 21: Public Support of R&D, Econ483: Econ of Innovation & Technology, Evangelia Chalioti c A ll rights reserved. Exercise Lecture 21: Public Support of R&D, Econ483: Econ of Innovation & Technology, Evangelia Chalioti c A ll rights reserved. Assumptions: Two …rms - A and B Inverse demand function: P = 100 Q where Q = qA + qB Firms engage in Cournot (quantity) competition Pre-merger marginal cost: c0 = 40 Fixed costs per …rm: F = 300 Post-merger marginal cost: c1 = 30 L...
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This note was uploaded on 03/16/2014 for the course ECON 483 taught by Professor Staff during the Spring '08 term at University of Illinois, Urbana Champaign.

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