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Growth: Scale or market-size effects?

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  • Chu, Angus C.
  • Cozzi, Guido

Abstract

Is the supply of researchers or the demand for technologies more important for innovation? The supply of research labor captures a scale effect, whereas the demand from production labor for technologies captures a market-size effect. We find that both the scale effect and the market-size effect are important for innovation and their relative importance depends on R&D labor intensity. We collect data on R&D labor intensity and find that it varies significantly across countries.

Suggested Citation

  • Chu, Angus C. & Cozzi, Guido, 2019. "Growth: Scale or market-size effects?," Economics Letters, Elsevier, vol. 178(C), pages 13-17.
    • Handle: RePEc:eee:ecolet:v:178:y:2019:i:c:p:13-17
    DOI: 10.1016/j.econlet.2019.01.002
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    Cited by:

    1. Chu, Angus C. & Cozzi, Guido, 2019. "Growth: Scale or market-size effects?," Economics Letters, Elsevier, vol. 178(C), pages 13-17.
    2. Chu, Angus C. & Liao, Chih-Hsing, 2025. "Optimal patent policy and wealth inequality in a Schumpeterian economy," Journal of Macroeconomics, Elsevier, vol. 83(C).
    3. repec:rim:rimwps:20-20 is not listed on IDEAS

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    More about this item

    Keywords

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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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