Whither Flat Panel Displays? / Kala Krishna, Marie Thursby.

Format:

Book

Author/Creator:

Krishna, Kala.

Contributor:

National Bureau of Economic Research.

Thursby, Marie.

Series:

Working Paper Series (National Bureau of Economic Research) no. w5415.

NBER working paper series no. w5415

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1996.

Summary:

This paper examines possible consequences of subsidies to R&D and to volume production proposed under the Clinton administration's flat panel display initiative. We do this in the context of a model in which firms behave competitively in the short run, while realizing that their choices of capacity and yield-improving R&D in the medium and long run will affect market price. Policy simulations show that steady state yields and profits are lower, while prices are higher with subsidies for capacity acquisition than with R&D subsidies. This occurs because a firm's incentives to do R&D are diminished by a subsidy on capacity costs.

Notes:

Print version record

January 1996.