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Horizontal Innovation, Market Power And Growth


  • Alberto Bucci


I build a generalised model of horizontal product innovation and economic growth taking explicitly into account the most relevant insights stemming from the recent literature on this topic. What results from the analysis is that, when innovation is both deterministic and horizontal, the relationship between market power and aggregate growth is not robust at all. It is also found that not only technology, but also the inter-sectoral competition for the same resource affects growth. This is particularly relevant in terms of public policies aimed at the strategic allocation of skilled workers to the different sectors of the economy. [D43, L16, O31, O41]

Suggested Citation

  • Alberto Bucci, 2001. "Horizontal Innovation, Market Power And Growth," International Economic Journal, Taylor & Francis Journals, vol. 17(1), pages 57-82.
  • Handle: RePEc:taf:intecj:v:17:y:2001:i:1:p:57-82 DOI: 10.1080/10168730300080005

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    References listed on IDEAS

    1. Dornbusch, Rudiger, 1993. "The End of the German Miracle," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 881-885, June.
    2. Hans-Werner Sinn, 1995. "Staggering along: wages policy and investment support in East Germany," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(4), pages 403-426, December.
    3. Marcus Noland & Sherman Robinson & Ligang Liu, 1999. "The economics of korean unification," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 3(3), pages 255-299.
    4. John Kennan, 1995. "The Elusive Effects of Minimum Wages," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1950-1965, December.
    5. Gerlinde Sinn & Hans-Werner Sinn, 1994. "Jumpstart: The Economic Unification of Germany," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262691728, July.
    6. Richard A. Brecher, 1974. "Minimum Wage Rates and the Pure Theory of International Trade," The Quarterly Journal of Economics, Oxford University Press, vol. 88(1), pages 98-116.
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    Cited by:

    1. Alberto Bucci, 2005. "Human capital, product market power and economic growth," Chapters,in: Innovation, Unemployment and Policy in the Theories of Growth and Distribution, chapter 1 Edward Elgar Publishing.
    2. Yılmaz, Ensar, 2013. "Competition, taxation and economic growth," Economic Modelling, Elsevier, vol. 35(C), pages 134-139.
    3. Alberto Bucci, 2003. "R&D, Imperfect Competition and Growth with Human Capital Accumulation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(4), pages 417-439, September.
    4. Ugo Fratesi, 2003. "Innovation Diffusion and the Evolution of Regional Disparities," ERSA conference papers ersa03p327, European Regional Science Association.
    5. Nicola MATTEUCCI & Alessandro STERLACCHINI, 2003. "ICT and Employment Growth in Italian Industries," Working Papers 193, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    6. Alberto BUCCI, 2002. "Market Power, Human Capital and Growth," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2002012, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).

    More about this item

    JEL classification:

    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models


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