Centralized Innovation Policy in an agglomeration and growth model: A welfare analysis
AbstractInnovation policies are strategic tools for reinforcing long-term economic growth. If the literature highlights the need for coordination among national R&D policies, the need for transnational policies appears to be less clear. Using a model à la Martin and Ottaviano (1999), we conduct a welfare analysis in order to judge the effect of a centralized R&D subsidy policy. If theoretical results suggest that this policy can improve efficiency and equity, our welfare analysis shows that when there are few knowledge spillovers between countries, then the policy leads to a conflict of interest. In the case of strong international knowledge spillovers however, the conflict of interest disappears suggesting that innovation policies should ﬁrst focus on the development of knowledge flows between countries.
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Date of creation: 2011
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agglomeration and growth models; innovation policy; welfare criteria;
Other versions of this item:
- Benjamin Montmartin, 2011. "Centralized Innovation Policy in an agglomeration and growth model : A welfare analysis," Working Papers 1101, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
- H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-30 (All new papers)
- NEP-CSE-2011-01-30 (Economics of Strategic Management)
- NEP-KNM-2011-01-30 (Knowledge Management & Knowledge Economy)
- NEP-URE-2011-01-30 (Urban & Real Estate Economics)
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- d'ASPREMONT, Claude & JACQUEMIN, Alexis, .
"Cooperative and noncooperative R&D in duopoly with spillovers,"
CORE Discussion Papers RP
-823, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- d'Aspremont, Claude & Jacquemin, Alexis, 1988. "Cooperative and Noncooperative R&D in Duopoly with Spillovers," American Economic Review, American Economic Association, vol. 78(5), pages 1133-37, December.
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