Cost-Reducing Alliances and Local Spillovers
Firms raise cost-reducing alliances before competing with each other, but cannot fully internalize the shared knowledge, according to the author. When spillovers are local and transit through the network of alliances, stable architectures with a moderate level of asymmetry are identified.
Link
http://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID655042_code114544.pdf?abstractid=655042&mirid=1