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A Decision Theoretic Model of Innovation, Technology Transfer, and Trade

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Author Info
Jensen, Richard
Thursby, Marie

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Abstract

The authors analyze a dynamic North-South model of innovation, technology transfer, and trade. Northern firms conduct R&D using labor, which has alternative uses producing in the R&D sector or a nontraded good sector. Since technology trans fer prevents the North from fully appropriating benefits of R&D, the optimal rate of innovation for either profit-maximizing firms or a ut ility-maximizing northern planner is less than globally optimal. An i nceased transfer rate intensifies competition of lower wage southern workers with northern workers in production, so profit-maximizing Nor thern firms reallocate labor toward R&D. Copyright 1987 by The Review of Economic Studies Limited.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of Economic Studies.

Volume (Year): 54 (1987)
Issue (Month): 4 (October)
Pages: 631-47
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Handle: RePEc:bla:restud:v:54:y:1987:i:4:p:631-47

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0034-6527

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  1. Baldwin, John R. & Lileeva, Alla, 2008. "Adaptation à la concurrence des importations : effets du commerce avec les pays à bas salaires sur le portefeuille de produits des établissements manufacturiers canadiens," Série de documents de recherche sur l'analyse économique (AE) 2008054f, Statistics Canada, Direction des études analytiques. [Downloadable!]
  2. Pol Antras, 2004. "Incomplete Contracts and the Product Cycle," Econometric Society 2004 North American Summer Meetings 62, Econometric Society. [Downloadable!]
    Other versions:
  3. Gene M. Grossman & Elhanan Helpman, 1990. "Product Development and International Trade," NBER Working Papers 2540, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  4. Kala Krishna & Marie Thursby, 1996. "Whither Flat Panel Displays?," NBER Working Papers 5415, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
    • Krishna, K. & Thursbay, M., 1996. "Whither Flat Panel Display?," Papers 1-96-1, Pennsylvania State - Department of Economics.
    • Krishna, K & Thursby, M, 1995. "Whither Flat Panel Displays?," Papers 95-007, Purdue University, Krannert School of Management - Center for International Business Education and Research (CIBER).
    • Kala Krishna & Marie Thursby, 1997. "Whither Flat Panel Displays?," NBER Chapters, in: The Effects of U.S. Trade Protection and Promotion Policies, pages 247-271 National Bureau of Economic Research, Inc. [Downloadable!]
  5. Michael Fung, 1994. "Technology policies, technology transfer by multinational enterprises and R&D activities in LDCs," Open Economies Review, Springer, vol. 5(3), pages 275-287, July. [Downloadable!] (restricted)
  6. Baldwin, John R. & Lileeva, Alla, 2008. "Adapting to Import Competition: Effects of Low-wage Trade on Commodity Mix in Canadian Manufacturing Plants," Economic Analysis (EA) Research Paper Series 2008054e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
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