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Competitive Innovation with Codified And Tacit Knowledge

  • Tetsugen Haruyama

    ()

    (Graduate School of Economics, Kobe University)

R&D-based models of endogenous technical progress rest on a premise that technical progress is driven by profit-seeking entrepreneurs. This literature led to a dominant view that endogenous technical advance is not consistent with perfect competition with constant returns to scale. Departing from this dominant perspective, we demonstrate that technical progress endogenously occurs in a perfectly competitive economy under constant returns to scale in rivalrous inputs. Our result is based on a hypothesis that R&D creates codified and tacit knowledge as joint products. Empirical and case studies are discussed to support the hypothesis. Using the model, we demonstrate that stronger patent protection can encourage or discourage R&D, depending on the size of an economy.

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File URL: http://www.econ.kobe-u.ac.jp/RePEc/koe/wpaper/2009/0905.pdf
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Paper provided by Graduate School of Economics, Kobe University in its series Discussion Papers with number 0905.

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Length: 32pages
Date of creation: Apr 2009
Date of revision:
Handle: RePEc:koe:wpaper:0905
Contact details of provider: Web page: http://www.econ.kobe-u.ac.jp
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  1. Acemoglu, Daron, 1997. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," CEPR Discussion Papers 1707, C.E.P.R. Discussion Papers.
  2. Tetsugen Haruyama, 2009. "Competitive Innovation with Codified And Tacit Knowledge," Discussion Papers 0905, Graduate School of Economics, Kobe University.
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  14. Jovanovic, B., 1998. "Vintage Capital and Equality," Working Papers 98-16, C.V. Starr Center for Applied Economics, New York University.
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  19. Klaus Wälde, 2005. "Endogenous Growth Cycles," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 46(3), pages 867-894, 08.
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  30. repec:fth:starer:9816 is not listed on IDEAS
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