Abstract: Based on endogenous timing game theory, the equilibrium move order of R&D is studied in this paper in a multi-stage game in which firms R&D are followed by competition in product market, with the assumption that in product market the demand function is linear and the move-order is simultaneously. With backward induction it is shown that, equilibrium R&D order is only decided by firms' R&D spillover. When both firms' spillover rates are low (high), the equilibrium R&D order is simultaneous play (sequential play with both leader-follower configurations). When one firm's spillover rate is low and the other's is high the equilibrium R&D order is sequential play with the low-spillover-rate-firm as the leader. When equilibrium R&D order is sequential play the total R&D level, the social welfare and the output(price) in product market are (is) higher (lower) than simultaneous R&D.

Key words: endogenous timing, R&D, spillover, equilibrium