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The origins of the economics of innovation: the Rae’s contribution

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Nowadays the innovation is one of the most important determinant for increasing the wealth of the nations. The patterns of technological innovation are studied by Economics of innovation. The aim of this paper is to prove that the origins of the Economics of innovation go back to many years before Schumpeter’s theory (1911), thank to the original studies of Rae. He really did not know much of any economics literature and developed most of his concepts on his own. J. Rae has recently been rediscovered as a genuine precursor of the endogenous growth theory. I think, he needs to be rediscovered a second time for his contribution to the understanding of the economic role played by the innovation and technology change within the economic system. The Scottish philosopher within his book Statement of Some New Principles on the Subject of Political Economy, issued in 1834, put forward the basis of the Economics of innovation individuating the nature, causes and effects of the technological progress on economic growth. The main results achieved are the importance of Rae’s work for the Economics of innovation and a definition of this branch which embodied the main concepts appeared during the history of the economic thought. Clearly, it is not complete definition, but it is the first step towards a completely individuation of the purpose of this important field of specialisation within the Economics

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Paper provided by Institute for Economic Research on Firms and Growth - Moncalieri (TO) in its series CERIS Working Paper with number 200401.

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Length: 24 pages
Date of creation: Jun 2004
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Handle: RePEc:csc:cerisp:200401

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Keywords: Invention; Innovation; History of Technology; Economic Growth;

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  1. Alessandro Sembenelli & Laura Rondi & Fabio Schiantarelli & Brian Sack, 1993. "Firms' Financial And Real Responses To Business Cycle Shocks And Monetary Tightening: Evidence For Large And Small Italian Companies," CERIS Working Paper 199305, Institute for Economic Research on Firms and Growth - Moncalieri (TO).
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