Perfectly Competitive Innovation
33 Pages Posted: 23 Apr 2002
There are 2 versions of this paper
Perfectly Competitive Innovation
Date Written: March 2002
Abstract
We construct a competitive model of innovation and growth under constant returns to scale. Previous models of growth under constant returns cannot model technological innovation. Current models of endogenous innovation rely on the interplay between increasing returns and monopolistic markets. In fact, established wisdom claims monopoly power to be instrumental for innovation and sees the non-rivalrous nature of ideas as a natural conduit to increasing returns. The results here challenge the positive description of previous models and the normative conclusion that monopoly through copyright and patent is socially beneficial.
Keywords: Innovation, endogenous technological change, monopoly power
JEL Classification: D62, L16, O11, O31, O33, O34
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Learning, Institutions, and Economic Performance
By C. Mantzavinos, Douglass C. North, ...
-
Increasing Returns and New Developments in the Theory of Growth
-
Export and Innovation Activities in the German Service Sector: Empirical Evidence at the Firm Level
By Günther Ebling and Norbert Janz
-
The Formation of the East India Company as a Cooperation-Enhancing Institution
By Ron Harris
-
A Tale of Two Theories: Monopolies and Craft Guilds in Medieval England and Modern Imagination
-
Imbalance Effects in the Lucas Model: An Analytical Exploration
-
Institutions Matter! Why the Herder Problem is Not a Prisoner's Dilemma
By Daniel H. Cole and Peter Z. Grossman