Andrey Pleshchynski

The competition and cooperation when technological innovation developing is investigated by means of proposed economic-mathematical model. The analysis is based on a two-level system of games. At the first, higher, level firms compete at the market, carrying out researches and development, independently or in cooperation, or rejecting the innovations. The production is based on traditional technology. After the players take these medium or long-term strategies they implement the tactical decisions of the second level of management. Firms compete by selecting volume of new technological production in case of completing the innovation, else in the absence of innovative development they use the old mode of production. For innovative and conservative strategies of two competing firms the terms of Nash quilibrium are formulated. Identified the minimum and maximum values of the development costs of the new technology for each company that defines its strategies. These cost limits are determined by profit increase effects from them using the alternative strategies. They figure five areas in the positive values of innovative cost. In each area the players choose one profitable strategy. The efficiency of cooperation in the development of technological innovation on conditions of imperfect competition at the product market is proved. The results of competition and cooperation analysis in the development of reducing the cost of technological innovation are validated on numeric examples of Cournot and Stackelberg duopolies.