Author: Olivier CadotPublisher:
ISBN:
Category : Barriers to entry (Industrial organization)
Languages : en
Pages : 24
Book Description
Barriers to Imitation and the Incentive to Innovate
Author: Olivier CadotPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
When innovation is followed by imitator entry, the degree to which the innovator can appropriate the rents induced by its innovations, influences the rate of innovative activity. The author's interest focuses upon the interaction between the rate of innovative activity and the length l of the delay between the innovation and imitation, in a model in which innovative activity generates a sequence of new innovations in the face of market saturation, a competitive motivation (to maintain the monopoly position), and a strategic motivation (to deter entry). The goal of the authors' analysis is to elicit the circumstances in which each force dominates. Because of these countervailing forces, the optimal rate of innovation may not be monotone in the delay l; furthermore, a more easily saturated market can benefit the innovator.
Barriers to Imitation and the Incentive to Innovate
Author: O. CadotDominant Firms, Imitation, and Incentives to Innovate
Author: Luís M. B. CabralThe Effect of Technological Imitation on Corporate Innovation
Author: Hyun Joong ImPublisher:
ISBN:
Category :
Languages : en
Pages : 66
Book Description
Technological imitation may play a crucial role in motivating firms to innovate. However, theoretical predictions and empirical findings on the role of imitation have not yet reached a consensus. One major gap in the previous studies is that the empirical tests are based on samples consisting of only one industry over a short period of time. This study uses a novel measure of industry-level technological imitation proxied by quick citations by competitors to examine the relationship between imitation and innovation. Using US patent data for the period 1977-2005, we find that there are inverted U-shaped relationships between the degree of industry-level technological imitation and industry-level innovation activities and between the degree of industry-level technological imitation and the value of firm-level innovation. Our results suggest that positive externalities from the interactions among firms during the innovation process outweigh the negative effects of free-riding concerns on firms' innovation activities and incentives to innovate up to a high degree of technological imitation, while free-riding concerns outweigh the positive externalities when the level of technological imitation is extremely high. The sector-by-sector analyses show that the relationship between technological imitation and the quantity and market value of innovation are not very different across Pavitt sectors. A comparative analysis on the role of imitation between agglomerated and non-agglomerated industries suggests that the positive effect of a moderate level of imitation and the negative effect of an excessive level of imitation are more pronounced for agglomerated industries. The results suggest that creating innovation clusters, such as Silicon Valley in the United States and Shenzhen City in China, and allowing different innovators to cooperate, imitate and compete with each other would be very effective in promoting corporate innovation. However, an excessively high level of technological imitation is more detrimental for firms in innovation clusters because it lowers those firms' incentives to innovate more radically.
Competitive Diffusion
Author: Boyan JovanovicPublisher:
ISBN:
Category : Diffusion of innovations
Languages : en
Pages : 62
Book Description
The usual explanation for why the producers of a given product use different technologies involves "vintage-capital": A firm understands the frontier technology, but can still prefer an older, less efficient technology in which it has made specific physical and human capital investments. This paper develops an alternative. "information-barrier" hypothesis: Firms differ in the technologies they use because it is costly for them to overcome the informational barriers that separate them. The paper endogenizes both innovative and imitative effort. The industry life-cycle implications -- declining price and increasing output -- broadly agree with the Gort-Klepper data. Empirically, the paper focuses on the slow spread of Diesel locomotives, which can not be explained by the vintage-capital hypothesis alone. For instance, contrary to that hypothesis, railroads were buying new steam locomotives long after the Diesel first came into use -- exactly as the information-barrier hypothesis would imply
The Illusion of the Commons
Author: Jonathan BarnettPublisher:
ISBN:
Category :
Languages : en
Pages : 68
Book Description
Intellectual property rests on a simple incentive rationale: without imitation barriers, innovators rationally decline to invest. But this blanket proposition is incompatible with markets where innovation proceeds without substantial recourse to intellectual property and imitation is widespread. This discrepancy sometimes drives the alternative view that intellectual property or other access barriers often or even usually are not prerequisites for intellectual production. But utopian understandings oversimplify the complex incentive structures and circumscribed conditions under which some markets can induce innovation without intellectual property or practical equivalents. A simple rational choice framework anticipates that sharing regimes - that is, innovation environments bereft of exclusionary barriers but governed by reputational norms - can sustain a viable habitat for innovation but inherently deteriorate as endowment heterogeneity, group size, asset values and capital intensities increase. Empirics substantially track theory: industries that sustain innovation without robust intellectual-property protections tend to be confined to low-stakes settings or make indirect recourse to other exclusionary instruments. Critically, however, it is also the case that voluntarily-formed sharing arrangements pervade even economically-intensive markets. Properly understood, these sharing arrangements do not substitute for property but provide a vital complementary mechanism that alleviates the transaction-cost burden of an exclusionary regime. Examination of three best cases for the view that intellectual production can proceed without intellectual property - premodern craft guilds, academic research and open source software - supports this intermediate position: sharing practices proliferate to facilitate the low-cost circulation of knowledge assets but are consistently embedded within a legal or technological infrastructure that implements some barrier to imitation.
The Boundaries of the Firm
Author: Neil M. KayPublisher: Springer
ISBN: 1349146455
Category : Business & Economics
Languages : en
Pages : 281
Book Description
What is the nature of the firm? Why do firms adopt certain strategies in preference to others? What are the competitive implications of large firm mergers and alliances for government policy? These are extremely important and highly topical questions which tend to be treated separately in most contemporary analysis. However, in this new book based on his original research, Neil Kay shows how these questions are closely inter-related and explores the implications this has for the formulation of corporate strategy and public policy.
Sharing in the Shadow of Property
Author: Jonathan BarnettPublisher:
ISBN:
Category :
Languages : en
Pages : 73
Book Description
Intellectual property rests on a simple incentive rationale: without imitation barriers, innovators rationally decline to invest. But this blanket proposition is incompatible with markets where innovation proceeds without substantial recourse to intellectual property and imitation is widespread. This discrepancy sometimes drives the alternative view that intellectual property or other access barriers often or even usually are not prerequisites for intellectual production. But quot;utopianquot; understandings oversimplify the complex incentive structures and circumscribed conditions under which some markets can induce innovation without intellectual property or practical equivalents. A simple rational choice framework anticipates that quot;sharing regimesquot; - that is, innovation environments bereft of exclusionary barriers but governed by reputational norms - can sustain a viable habitat for innovation but inherently deteriorate as endowment heterogeneity, group size, asset values and capital intensities increase. Empirics substantially track theory: industries that sustain innovation without robust intellectual-property protections tend to be confined to quot;low-stakesquot; settings or make indirect recourse to other exclusionary instruments. Critically, however, it is also the case that voluntarily-formed sharing arrangements pervade even economically-intensive markets. Properly understood, these sharing arrangements do not substitute for property but provide a vital complementary mechanism that alleviates the transaction-cost burden of an exclusionary regime. Examination of three quot;best casesquot; for the view that intellectual production can proceed without intellectual property - premodern craft guilds, academic research and open source software - supports this intermediate position: sharing practices proliferate to facilitate the low-cost circulation of knowledge assets but are consistently embedded within a legal or technological infrastructure that implements some barrier to imitation.
The Industrial Sector
Author: Richard H. StephensPublisher:
ISBN:
Category : Industrial policy
Languages : en
Pages : 142
Book Description
Innovation, Economic Change and Technology Policies
Author: STROETMANNPublisher: Birkhäuser
ISBN: 3034858671
Category : Science
Languages : en
Pages : 348
Book Description
Technological progress is a major factor chaping economic growth. Today's standard of living is a direct result of scientific advances and technical change in the past. Since uncontrolled technological progress has become amenace to our well being and may actually threat our survival, it is necessary to learn to manage technological progress and direct innovative activities in such a manner that both private wants and social needs playa dominant role in determining the rate and direction of technical change. This requires a better understanding of the processes of technical change, of their impact on and interrelationships with economic and social developments and of the means and measures by which both individuals and governments can influence and direct technological progress. To this end, the Ninistry for Research and Technology of the Federal Republ ic of Germany and the National Science Foundation of the Uni ted States of America invited a group of scholars, corporate managers and civil servants to a one week seminar on "Technolo gical Innovation". The seminar took place in April, 1976, in Bonn, Federal Republ ic of Germany. Most papers presented at this meeting were specifically prepared for the seminar. With this volume, they are made available to a larger audience to further stimulate discussion not only among scholars interested in innovation research and technology policy questions but also among managers, union officials, civil ser vants and others directly or indirectly concerned with and affected by technical change.