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Path dependence, endogenous innovation, and growth

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  • Redding, Stephen

Abstract

This paper presents a model of endogenous innovation and growth, in which technological change is path dependent. The historical pattern of technological development plays a central role in determining the pace of future technological change. Path dependence is explained using a distinction between fundamental and secondary knowledge. The economy moves endogenously between periods of drastic and nondrastic innovation. Technological lock-in is shown to be a special case of path dependence. The model provides a rationale for cycles in technological leadership. This rationale exists in equilibria with positive levels of fundamental research and in a world with no imitation.

Suggested Citation

  • Redding, Stephen, 2002. "Path dependence, endogenous innovation, and growth," LSE Research Online Documents on Economics 208, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:208
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    References listed on IDEAS

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    More about this item

    Keywords

    endogenous innovation; fundamental knowledge; path dependence; research and development (R&D); technological lock-in.;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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