Increasing Returns, Input-Output Linkages, and Technological Leapfrogging
AbstractFirms agglomerate in one region due to increasing returns, input-output linkages and transportation costs. In the de-industrialised region factor prices are lower and a new technology may be profitable to adopt in that region instead, inducing a change in the technological leadership. This paper shows that the risk of locking in to an old technology is monotonically increasing in the benefits of agglomeration. Greater incompatibility between technologies also increases the risk of rejecting potentially superior manufacturing processes.
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Bibliographic InfoPaper provided by Lund University, Department of Economics in its series Working Papers with number 2005:22.
Length: 28 pages
Date of creation: 11 Mar 2005
Date of revision: 19 Jul 2006
Publication status: Published in Topics in Economic Analysis & Policy, 2006.
Contact details of provider:
Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/
More information through EDIRC
agglomeration; lock-in; new economic geography; technological leapfrogging;
Other versions of this item:
- Gallo Fredrik, 2006. "Increasing Returns, Input-Output Linkages, and Technological Leapfrogging," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 6(1), pages 1-29, August.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-03-20 (All new papers)
- NEP-DEV-2005-03-20 (Development)
- NEP-EFF-2005-03-20 (Efficiency & Productivity)
- NEP-MIC-2005-03-20 (Microeconomics)
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