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Market concentration and technological innovation in a dynamic model of growth and distribution

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  • Gilberto Tadeu Lima

    (University of S‹o Paulo, Department of Economics, S‹o Paulo (Brazil))

Abstract

This paper develops a post Keynesian macromodel of growth and distribution in which endogenous technological innovation plays a pivotal role. The innovationrate is made quadratic in market concentration, to capture a plausible neo-Schumpeterian non-linear influence of market structure on firms' propensity to innovate. Concentration is endogenous, though, since under neo-Schumpeterian competition the relation between market structure and technical change cuts both ways. Investment will then be non-linear in concentration, and the effect of changes in concentration on capacity utilisation, growth and distribution will depend on the level of concentration. Demand also plays a role, with capacity utilisation andgrowth rising with the wage share. The dynamic stability properties of the system will depend on the direction and relative strength of the technological innovation effects with respect to the demand ones, and on the relative bargaining power of workers and capitalists.

Suggested Citation

  • Gilberto Tadeu Lima, 2000. "Market concentration and technological innovation in a dynamic model of growth and distribution," Banca Nazionale del Lavoro Quarterly Review, Banca Nazionale del Lavoro, vol. 53(215), pages 447-475.
    • Handle: RePEc:psl:bnlqrr:2000:44
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    Cited by:

    1. Ana Bottega & Rafael S. M. Ribeiro, 2023. "Kalecki meets Schumpeter: The decline of competition in a demand‐led dynamic model," Metroeconomica, Wiley Blackwell, vol. 74(3), pages 584-605, July.
    2. Gilberto Tadeu Lima & Antonio J. A. Meirelles, 2007. "Macrodynamics of debt regimes, financial instability and growth," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(4), pages 563-580, July.
    3. Parui, Pintu, 2021. "Financialization and endogenous technological change: A post-Kaleckian perspective," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 221-244.
    4. Fabrício J. Missio & Frederico G. Jayme Jr. & Gustavo Britto & José Luis Oreiro, 2015. "Real Exchange Rate and Economic Growth: New Empirical Evidence," Metroeconomica, Wiley Blackwell, vol. 66(4), pages 686-714, November.
    5. Roberto Veneziani & Luca Zamparelli & Amitava Krishna Dutt, 2017. "Heterodox Theories Of Economic Growth And Income Distribution: A Partial Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1240-1271, December.
    6. Eckhard Hein, 2012. ""Financialization," distribution, capital accumulation, and productivity growth in a post-Kaleckian model," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 34(3), pages 475-496.
    7. Jaylson Jair da Silveira & Gilberto Tadeu Lima, 2016. "Effort Elicitation, Wage Differentials and Income Distribution in A Wage-Led Growth Regime," Metroeconomica, Wiley Blackwell, vol. 67(1), pages 44-75, February.
    8. Eckhard Hein, 2012. "The Macroeconomics of Finance-Dominated Capitalism – and its Crisis," Books, Edward Elgar Publishing, number 14931.
    9. Gilberto Tadeu Lima & Antonio J. A. Meirelles, 2003. "Endogenous Banking Markup, Distributional Conflict and Capacity Utilization," Metroeconomica, Wiley Blackwell, vol. 54(2‐3), pages 366-384, May.
    10. Eckhard Hein & Artur Tarassow, 2010. "Distribution, aggregate demand and productivity growth: theory and empirical results for six OECD countries based on a post-Kaleckian model," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 34(4), pages 727-754.
    11. Gilberto Tadeu Lima, 2003. "A Non-linear Development Dynamics of Capital Accumulation, Distribution and Technological Innovation," Anais do XXXI Encontro Nacional de Economia [Proceedings of the 31st Brazilian Economics Meeting] b05, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    12. Antonio Meirelles & Gilberto Lima, 2006. "Debt, financial fragility, and economic growth: a Post Keynesian macromodel," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 29(1), pages 93-115.
    13. Krap, Niels & Stephan, Johannes, 2008. "The Relationship between Knowledge Intensity and Market Concentration in European Industries: An inverted U-Shape," IWH Discussion Papers 3/2008, Halle Institute for Economic Research (IWH).
    14. Gilberto Tadeu Lima, 2004. "Endogenous Technological Innovation, Capital Accumulation And Distributional Dynamics," Metroeconomica, Wiley Blackwell, vol. 55(4), pages 386-408, November.

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    More about this item

    Keywords

    Concentration; Distribution; Firm; Firms; Growth; Innovation; Market Structure; Technological Innovation;
    All these keywords.

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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