Notice of RetractionProduct and Process Innovations in Part-Coverage Markets Exhibiting Network Externality

Notice of Retraction

After careful and considered review of the content of this paper by a duly constituted expert committee, this paper has been found to be in violation of IEEE´s Publication Principles.

We hereby retract the content of this paper. Reasonable effort should be made to remove all past references to this paper.

The presenting author of this paper has the option to appeal this decision by contacting TPII@ieee.org.

By extending vertically differentiated model, how the product innovation affects process innovation is investigated in a part-coverage duopoly market. The market exhibits network externality and the process innovation (resp. product innovation) reduces marginal cost (resp. improves product quality). Though the numerical analysis, it is found that: (i) product innovation lowers process innovation efforts of high-quality firm; (ii) how product innovation affects process innovation efforts of low-quality firm depends on network externality. When the intensity of network externality is small enough, the process innovation efforts first increase and then decrease with product innovation; when the intensity of network externality is big enough, the process innovation efforts increase with product innovation; (iii) the total process innovation efforts in the market depend on both firms´ product innovation.