AbstractThis paper studies the evolution of a competitive industry in which a fixed number of firms reduce costs by innovating and by imitating their rivals' technologies. As the firms' technologies gradually improve, industry output expands and price falls. Technological leaders tend to rely on innovations to reduce their costs, whereas the laggards rely more on imitation. Imitation causes technology to spread from the leaders to the followers and forces some convergence of technology among firms as the industry matures. This convergence is accompanied by faster growth of smaller firms and a consequent tightening of the distribution of output over firms. Copyright 1994 by University of Chicago Press.
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Bibliographic InfoPaper provided by University of Rochester - Center for Economic Research (RCER) in its series RCER Working Papers with number 160.
Length: 63 pages
Date of creation: 1988
Date of revision:
Contact details of provider:
Postal: University of Rochester, Center for Economic Research, Department of Economics, Harkness 231 Rochester, New York 14627 U.S.A.
economic models ; innovations ; research and development ; railways ; coal mining;
Other versions of this item:
- Jovanovic, Boyan & MacDonald, Glenn M, 1994. "Competitive Diffusion," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 102(1), pages 24-52, February.
- Jovanovic, Boyan & MacDonald, Glenn M., 1988. "Competitive Diffusion," Working Papers, C.V. Starr Center for Applied Economics, New York University 88-29, C.V. Starr Center for Applied Economics, New York University.
- Macdonald, G.M., 1988. "Competitive Diffusion," University of Chicago - Economics Research Center, Chicago - Economics Research Center 88-10, Chicago - Economics Research Center.
- Boyan Jovanovic & Glenn MacDonald, 1993. "Competitive Diffusion," NBER Working Papers 4463, National Bureau of Economic Research, Inc.
- Jovanovic, B. & MacDonald, G.M., 1991. "Competitive Diffusion," Papers, Rochester, Business - Financial Research and Policy Studies 92-08, Rochester, Business - Financial Research and Policy Studies.
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Bell Journal of Economics, The RAND Corporation,
The RAND Corporation, vol. 13(2), pages 324-340, Autumn.
- Bengt Holmstrom, 1981. "Moral Hazard in Teams," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 471, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Karl Shell, 2010. "A Model of Inventive Activity and Capital Accumulation," Levine's Working Paper Archive 1409, David K. Levine.
- Romer, Paul M, 1990.
"Endogenous Technological Change,"
Journal of Political Economy, University of Chicago Press,
University of Chicago Press, vol. 98(5), pages S71-102, October.
- Andolfatto, D. & MacDonald, G.M., 1995. "Endogeneous Technological Change, Growth, and Aggregate Functions," Working Papers 9504, University of Waterloo, Department of Economics.
- Jovanovic, Boyan & Rob, Rafael, 1989. "The Growth and Diffusion of Knowledge," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 56(4), pages 569-82, October.
- Gort, Michael & Klepper, Steven, 1982. "Time Paths in the Diffusion of Product Innovations," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 92(367), pages 630-53, September.
- Chari, V V & Hopenhayn, Hugo, 1991. "Vintage Human Capital, Growth, and the Diffusion of New Technology," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(6), pages 1142-65, December.
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