If she undertakes R&D at intensity II for a time interval of length df, then
she will succeed in taking the next step up the quality ladder for the targeted product
with probability idt. This formulation mimics the one-shot, partial equilibrium, patent race
models of Lee and Wilde (1980) and others. It implies that R&D success bears a
Poisson probability distribution with an arrival rate that depends only on the current
level of R&D activity.