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R&D and the agglomeration of industries

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Author Info
Jan Kranich () (Leuphana Universität Lüneburg)

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Abstract

This paper discusses a model of the New Economic Geography, in which the seminal core-periphery model of Krugman (1991) is extended by endogenous research activities. Beyond the common ’anonymous’ consideration of R&D expenditures within fixed costs, this model introduces vertical product differentiation, which requires services provided by an additional R&D sector. In the context of international factor mobility, the destabilizing effects of a mobile scientific workforce are analyzed. In combination with a welfare analysis and a consideration of R&D promoting policy instruments and their spatial implications, this paper makes a contribution to the so-called brain drain debate.

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Publisher Info
Paper provided by University of Lüneburg, Institute of Economics in its series Working Paper Series in Economics with number 83.

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Length: 53 pages
Date of creation: Apr 2008
Date of revision:
Handle: RePEc:lue:wpaper:83

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Related research
Keywords: R&D; New Economic Geography; Vertical Differentiation;

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Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
F17 - International Economics - - Trade - - - Trade Forecasting and Simulation

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    Other versions:
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  7. Jaffe, Adam B & Trajtenberg, Manuel & Henderson, Rebecca, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 577-98, August. [Downloadable!] (restricted)
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  9. Midelfart-Knarvik, K.H. & Overman, H.G. & Redding, S.J. & Venables, A.J., 2000. "The Location of European Industry," European Economy - Economic Papers 142, Commission of the EC, Directorate-General for Economic and Financial Affairs (DG ECFIN).
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