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Catch-up and fall-back through innovation and imitation

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  • Jess Benhabib

    ()

  • Jesse Perla

    ()

  • Christopher Tonetti

    ()

Abstract

Will fast growing emerging economies sustain rapid growth rates until they “catch-up” to the technology frontier? Are there incentives for some developed countries to free-ride off of innovators and optimally “fall-back” relative to the frontier? This paper models agents growing as a result of investments in innovation and imitation. Imitation facilitates technology diffusion, with the productivity of imitation modeled by a catch-up function that increases with distance to the frontier. The resulting equilibrium is an endogenous segmentation between innovators and imitators, where imitating agents optimally choose to “catch-up” or “fall-back” to a productivity ratio below the frontier. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Jess Benhabib & Jesse Perla & Christopher Tonetti, 2014. "Catch-up and fall-back through innovation and imitation," Journal of Economic Growth, Springer, vol. 19(1), pages 1-35, March.
  • Handle: RePEc:kap:jecgro:v:19:y:2014:i:1:p:1-35
    DOI: 10.1007/s10887-013-9095-z
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    Citations

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    Cited by:

    1. King Yoong Lim, 2015. "Industrial Transformation with Heterogeneous FDI and Human Capital," Centre for Growth and Business Cycle Research Discussion Paper Series 213, Economics, The Univeristy of Manchester.
    2. Pierre-Richard Agénor, 2017. "Caught In The Middle? The Economics Of Middle-Income Traps," Journal of Economic Surveys, Wiley Blackwell, vol. 31(3), pages 771-791, July.
    3. repec:pit:wpaper:535 is not listed on IDEAS
    4. Christos Pargianas, 2016. "Endogenous Economic Institutions and Persistent Income Differences among High Income Countries," Open Economies Review, Springer, vol. 27(1), pages 139-159, February.
    5. Chu, Angus C. & Cozzi, Guido & Galli, Silvia, 2014. "Stage-dependent intellectual property rights," Journal of Development Economics, Elsevier, vol. 106(C), pages 239-249.
    6. Nancy Stokey, 2015. "Catching up and falling behind," Journal of Economic Growth, Springer, vol. 20(1), pages 1-36, March.
    7. Ufuk Akcigit & Murat Alp Celik & Jeremy Greenwood, 2016. "Buy, Keep, or Sell: Economic Growth and the Market for Ideas," Econometrica, Econometric Society, vol. 84, pages 943-984, May.
    8. repec:kap:iecepo:v:15:y:2018:i:1:d:10.1007_s10368-017-0373-7 is not listed on IDEAS
    9. Polterovich, Victor, 2016. "Институты Догоняющего Развития
      [Institutions of Catching-up Development]
      ," MPRA Paper 73447, University Library of Munich, Germany.
    10. Miroslav Gabrovski, 2017. "Coordination Frictions and Economic Growth," 2017 Papers pga928, Job Market Papers.
    11. Pierre-Richard AGENOR, 2016. "Caught in the Middle? The Economics of Middle-Income Traps," Working Papers P142, FERDI.
    12. Keiichi Kishi, 2014. "A patentability requirement and industries targeted by R&D," Discussion Papers in Economics and Business 14-27-Rev., Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Oct 2014.
    13. Zilibotti, Fabrizio & König, Michael & Lorenz, Jan, 2016. "Innovation vs. imitation and the evolution of productivity distributions," Theoretical Economics, Econometric Society, vol. 11(3), September.
    14. Jess Benhabib & Jesse Perla & Christopher Tonetti, 2017. "Reconciling Models of Diffusion and Innovation: A Theory of the Productivity Distribution and Technology Frontier," NBER Working Papers 23095, National Bureau of Economic Research, Inc.
    15. repec:cuf:journl:y:2018:v:19:i:1:wang:xie is not listed on IDEAS
    16. repec:bla:coecpo:v:35:y:2017:i:4:p:735-750 is not listed on IDEAS

    More about this item

    Keywords

    Endogenous growth; Technology diffusion; Innovation; Imitation; Catch-up; Fall-back; O14; O30; O31; O33; O40;

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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