Decision on R&D collaboration and extent of knowledge spillover based on Cournot model

The intensity of market competition has put forward higher requirements for the innovative capability of enterprises, so companies increase their R&D investment greatly now. However, as innovation has externalities, companies are faced with the embarrassing situation that costs and benefits of innovation do not match with each other. It severely discourages companies' innovation, affecting the total social value they create. This phenomenon is particularly evident in industrial clusters. Therefore, it is considered as a new way for enterprises to look for partners to reduce development costs and share innovation benefits. This article will base on the assumption of Cournot model to give theoretical explanation and calculation instructions on whether a company should join R&D collaboration and the extent of knowledge spillover between enterprises.