1 option
Competition and Innovation: An Inverted U Relationship / Philippe Aghion, Nicholas Bloom, Richard Blundell, Rachel Griffith, Peter Howitt.
- Format:
- Book
- Author/Creator:
- Aghion, Philippe.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w9269.
- NBER working paper series no. w9269
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Competition and Innovation
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2002.
- Summary:
- This paper investigates the relationship between product market competition (PMC) and innovation. A growth model is developed in which competition may increase the incremental profit from innovating; on the other hand, competition may also reduce innovation incentives for laggards. There are four key predictions. First, the relationship between product market competition (PMC) and innovation is an inverted U-shape. Second, the equilibrium degree of technological neck-and-neckness' among firms should decrease with PMC. Third, the higher the average degree of neck-and-neckness' in an industry, the steeper the inverted-U relationship. Fourth, firms may innovate more if subject to higher debt-pressure, especially at lower levels of PMC. We confront these predictions with data on UK firms' patenting activity at the US patenting office. They are found to accord well with observed behavior.
- Notes:
- Print version record
- October 2002.
The Penn Libraries is committed to describing library materials using current, accurate, and responsible language. If you discover outdated or inaccurate language, please fill out this feedback form to report it and suggest alternative language.