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The impact of the density of star r&d networks on the maximum outcomes

Author: 
Mohamad Alghamdi

While the empirical findings have confirmed the importance of the centers in preserving the characteristic features of the R&D network, this paper will focus theoretically on central firms in the star networks. The analysis of the equilibrium outcomes reveals the impact of the market structure on centralizing of firms and on expanding the star network. It seems that when the differentiation rate between products of firms is high, the development of the star network contributes to increasing the individual and social outcomes. Whereas, if the substitution between the products is high, the benefit behind growing the star network limits to firms that form new R&D partnerships and to the total welfare.

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