We consider R&D outsourcing in an innovation-driven supply chain. We find that there exists a threshold in the firm's R&D cost above which it prefers to outsource via hosting a contest. When designing an R&D contest, we find that the firm benefits from inviting as many suppliers as possible if the R&D participation barrier is low. Otherwise, the firm may prefer to offer entry subsidies or impose fees to purposefully manipulate the contest structure.
- Entry intervention
- R&D contest
- R&D outsourcing
ASJC Scopus subject areas
- Management Science and Operations Research
- Industrial and Manufacturing Engineering
- Applied Mathematics