IDEAS home Printed from https://ideas.repec.org/p/ssa/lemwps/1999-11.html
   My bibliography  Save this paper

Technology, Entrepreneurship and Inequality: an Interpretative Model

Author

Listed:
  • Alfonso Gambardella
  • Davide Ticchi

Abstract

This paper purports to explain some recent trends in several advanced economies. Our model shows that the rise of new scientific and technological opportunities, and particularly the opportunities to develop riskier technological projects, is at the basis of the blossoming of small-medium sized high-tech companies in several regions of the world. This phenomenon, which has been widely documented, and has given rise to several remarks about the growth and employment opportunities of "Silicon Valley" models of industrial activities and employment, is contrasted with an economy based on more stable employment conditions in large firms. Our key result is that both an economy based on large firms and one based on high-tech smaller enterprises lead to higher expected incomes. But while the former implies lower inequality in the sense of lower variance of incomes, the latter implies both higher permanent and transitory inequality. This is consistent with some recent empirical findings about the increase in the variance of incomes in the US and the UK.

Suggested Citation

  • Alfonso Gambardella & Davide Ticchi, 1999. "Technology, Entrepreneurship and Inequality: an Interpretative Model," LEM Papers Series 1999/11, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  • Handle: RePEc:ssa:lemwps:1999/11
    as

    Download full text from publisher

    File URL: http://www.lem.sssup.it/WPLem/files/1999-11.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Holmstrom, Bengt, 1989. "Agency costs and innovation," Journal of Economic Behavior & Organization, Elsevier, vol. 12(3), pages 305-327, December.
    2. Kenney, Martin & von Burg, Urs, 1999. "Technology, Entrepreneurship and Path Dependence: Industrial Clustering in Silicon Valley and Route 128," Industrial and Corporate Change, Oxford University Press, vol. 8(1), pages 67-103, March.
    3. Langlois, Richard N. & Robertson, Paul L., 1992. "Networks and innovation in a modular system: Lessons from the microcomputer and stereo component industries," Research Policy, Elsevier, vol. 21(4), pages 297-313, August.
    4. Richard Blundell & Ian Preston, 1998. "Consumption Inequality and Income Uncertainty," The Quarterly Journal of Economics, Oxford University Press, vol. 113(2), pages 603-640.
    5. Peter Gottschalk & Robert Moffitt, 1994. "The Growth of Earnings Instability in the U.S. Labor Market," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(2), pages 217-272.
    6. Gambardella,Alfonso, 1995. "Science and Innovation," Cambridge Books, Cambridge University Press, number 9780521451185, April.
    7. Rothschild, Michael & Stiglitz, Joseph E., 1970. "Increasing risk: I. A definition," Journal of Economic Theory, Elsevier, vol. 2(3), pages 225-243, September.
    8. Fosfuri, Andrea & Arora, Ashish & Gambardella, Alfonso, 1999. "Markets for technology (why do we see them, why don't we see more of them and why we should care)," DEE - Working Papers. Business Economics. WB 6520, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    -;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ssa:lemwps:1999/11. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: () or (Rebekah McClure). General contact details of provider: http://edirc.repec.org/data/labssit.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.