IDEAS home Printed from https://ideas.repec.org/p/ssa/lemwps/2017-28.html
   My bibliography  Save this paper

Diffusing New Technology without Dissipating Rents: Some Historical Case Studies of Knwoledge Sharing

Author

Listed:
  • James Bessen
  • Alessandro Nuvolari

Abstract

The diffusion of innovations is supposed to dissipate inventors' rents. Yet in many documented cases, inventors freely shared knowledge with their competitors. Using a model and case studies, this paper explores why sharing did not eliminate inventors' incentives. Each new technology coexisted with an alternative for one or more decades. This allowed inventors to earn rents while sharing knowledge, attaining major productivity gains. The technology diffusion literature suggests that such circumstances are common during the early stages of a new technology.

Suggested Citation

  • James Bessen & Alessandro Nuvolari, 2017. "Diffusing New Technology without Dissipating Rents: Some Historical Case Studies of Knwoledge Sharing," LEM Papers Series 2017/28, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    • Handle: RePEc:ssa:lemwps:2017/28
    as

    Download full text from publisher

    File URL: http://www.lem.sssup.it/WPLem/files/2017-28.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Braguinsky, Serguey & Rose, David C., 2009. "Competition, cooperation, and the neighboring farmer effect," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 361-376, October.
    2. Jovanovic, Boyan & MacDonald, Glenn M, 1994. "The Life Cycle of a Competitive Industry," Journal of Political Economy, University of Chicago Press, vol. 102(2), pages 322-347, April.
    3. Lampe, Ryan & Moser, Petra, 2010. "Do Patent Pools Encourage Innovation? Evidence from the Nineteenth-Century Sewing Machine Industry," The Journal of Economic History, Cambridge University Press, vol. 70(4), pages 898-920, December.
    4. Alfonso Gambardella & Bronwyn H. Hall, 2010. "Proprietary versus Public Domain Licensing of Software and Research Products," Chapters, in: Riccardo Viale & Henry Etzkowitz (ed.), The Capitalization of Knowledge, chapter 6, Edward Elgar Publishing.
    5. Glenn C. Loury, 1979. "Market Structure and Innovation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(3), pages 395-410.
    6. Williamson, Jeffrey G, 1971. "Optimal Replacement of Capital Goods: The Early New England and British Textile Firm," Journal of Political Economy, University of Chicago Press, vol. 79(6), pages 1320-1334, Nov.-Dec..
    7. Petra Moser, 2012. "Innovation without Patents: Evidence from World's Fairs," Journal of Law and Economics, University of Chicago Press, vol. 55(1), pages 43-74.
    8. Jovanovic, Boyan & Lach, Saul, 1989. "Entry, Exit, and Diffusion with Learning by Doing," American Economic Review, American Economic Association, vol. 79(4), pages 690-699, September.
    9. Peter B. Meyer, 2003. "Episodes of Collective Invention," Working Papers 368, U.S. Bureau of Labor Statistics.
    10. Alessandro Nuvolari, 2004. "Collective invention during the British Industrial Revolution: the case of the Cornish pumping engine," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 28(3), pages 347-363, May.
    11. Reinganum, Jennifer F, 1983. "Uncertain Innovation and the Persistence of Monopoly," American Economic Review, American Economic Association, vol. 73(4), pages 741-748, September.
    12. Harley, C. Knick, 2012. "Was technological change in the early Industrial Revolution Schumpeterian? Evidence of cotton textile profitability," Explorations in Economic History, Elsevier, vol. 49(4), pages 516-527.
    13. Harhoff, Dietmar & Henkel, Joachim & von Hippel, Eric, 2003. "Profiting from voluntary information spillovers: how users benefit by freely revealing their innovations," Research Policy, Elsevier, vol. 32(10), pages 1753-1769, December.
    14. Alessandro Nuvolari & Bart Verspagen, 2009. "Technical choice, innovation, and British steam engineering, 1800–501," Economic History Review, Economic History Society, vol. 62(3), pages 685-710, August.
    15. Parente Stephen L., 1994. "Technology Adoption, Learning-by-Doing, and Economic Growth," Journal of Economic Theory, Elsevier, vol. 63(2), pages 346-369, August.
    16. Bessen, James, 2003. "Technology and Learning by Factory Workers: The Stretch-Out at Lowell, 1842," The Journal of Economic History, Cambridge University Press, vol. 63(1), pages 33-64, March.
    17. Boldrin,Michele & Levine,David K., 2010. "Against Intellectual Monopoly," Cambridge Books, Cambridge University Press, number 9780521127264.
    18. Julien Pénin, 2007. "Open Knowledge Disclosure: An Overview Of The Evidence And Economic Motivations," Journal of Economic Surveys, Wiley Blackwell, vol. 21(2), pages 326-347, April.
    19. Tom Lee & Louis L. Wilde, 1980. "Market Structure and Innovation: A Reformulation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(2), pages 429-436.
    20. Bronwyn H. Hall & Nathan Rosenberg (ed.), 2010. "Handbook of the Economics of Innovation," Handbook of the Economics of Innovation, Elsevier, edition 1, volume 1, number 1.
    21. Allen, Robert C., 1983. "Collective invention," Journal of Economic Behavior & Organization, Elsevier, vol. 4(1), pages 1-24, March.
    22. Christine MacLeod & Alessandro Nuvolari, 2009. "‘Glorious Times’: The Emergence of Mechanical Engineering in Early Industrial Britain, c. 1700-1850," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 52(3/4), pages 215-237.
    23. Chari, V V & Hopenhayn, Hugo, 1991. "Vintage Human Capital, Growth, and the Diffusion of New Technology," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1142-1165, December.
    24. Mass, William, 1989. "Mechanical and Organizational Innovation: The Drapers and the Automatic Loom," Business History Review, Cambridge University Press, vol. 63(4), pages 876-929, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Liu, Ziyu & Du, Yushen, 2022. "Open knowledge disclosure and technical standard competition in transition economies: A legitimacy perspective," Technology in Society, Elsevier, vol. 70(C).
    2. Elena-Madalina Vatamanescu & Wioletta Wereda & Jacek Woźniak, 2020. "Communication And Knowledge Management In Innovative Enterprises – Literature Review Perspective," Nowoczesne Systemy Zarządzania. Modern Management Systems, Military University of Technology, Faculty of Security, Logistics and Management, Institute of Organization and Management, issue 2, pages 41-55.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Serguey Braguinsky, 2015. "Knowledge diffusion and industry growth: the case of Japan’s early cotton spinning industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 24(4), pages 769-790.
    2. Atal, Vidya & Bar, Talia & Gordon, Sidartha, 2016. "Project selection: Commitment and competition," Games and Economic Behavior, Elsevier, vol. 96(C), pages 30-48.
    3. Acemoglu, Daron & Gancia, Gino & Zilibotti, Fabrizio, 2012. "Competing engines of growth: Innovation and standardization," Journal of Economic Theory, Elsevier, vol. 147(2), pages 570-601.3.
    4. Bronwyn Hall & Christian Helmers & Mark Rogers & Vania Sena, 2014. "The Choice between Formal and Informal Intellectual Property: A Review," Journal of Economic Literature, American Economic Association, vol. 52(2), pages 375-423, June.
    5. Henkel, Joachim, 2006. "Selective revealing in open innovation processes: The case of embedded Linux," Research Policy, Elsevier, vol. 35(7), pages 953-969, September.
    6. Braguinsky, Serguey & Rose, David C., 2009. "Competition, cooperation, and the neighboring farmer effect," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 361-376, October.
    7. Carliss Baldwin & Eric von Hippel, 2011. "Modeling a Paradigm Shift: From Producer Innovation to User and Open Collaborative Innovation," Organization Science, INFORMS, vol. 22(6), pages 1399-1417, December.
    8. James E. Bessen, 2010. "Communicating Technical Knowledge," Levine's Working Paper Archive 661465000000000308, David K. Levine.
    9. Thompson, Peter, 2010. "Learning by Doing," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 429-476, Elsevier.
    10. Schrape, Jan-Felix, 2017. "Open source projects as incubators of innovation: From niche phenomenon to integral part of the software industry," Research Contributions to Organizational Sociology and Innovation Studies, SOI Discussion Papers 2017-03, University of Stuttgart, Institute for Social Sciences, Department of Organizational Sociology and Innovation Studies.
    11. Fontana, Roberto & Nuvolari, Alessandro & Shimizu, Hiroshi & Vezzulli, Andrea, 2013. "Reassessing patent propensity: Evidence from a dataset of R&D awards, 1977–2004," Research Policy, Elsevier, vol. 42(10), pages 1780-1792.
    12. Clément Bonnet, 2016. "Revisiting the optimal patent policy tradeoff for environmental technologies," EconomiX Working Papers 2016-34, University of Paris Nanterre, EconomiX.
    13. Flavio DelbonoBy & Luca Lambertini, 2022. "Innovation and product market concentration: Schumpeter, arrow, and the inverted U-shape curve [Lessons from schumpeterian growth theory]," Oxford Economic Papers, Oxford University Press, vol. 74(1), pages 297-311.
    14. Hinloopen, J. & Smrkolj, G. & Wagener, F.O.O., 2013. "In Defense of Trusts: R&D Cooperation in Global Perspective," CeNDEF Working Papers 13-05, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
    15. de Jong, Jeroen P.J. & von Hippel, Eric, 2009. "Transfers of user process innovations to process equipment producers: A study of Dutch high-tech firms," Research Policy, Elsevier, vol. 38(7), pages 1181-1191, September.
    16. Jeroen Hinloopen & Grega Smrkolj & Florian Wagener, 2016. "R&D Cooperatives and Market Collusion: A Global Dynamic Approach," Tinbergen Institute Discussion Papers 16-048/II, Tinbergen Institute.
    17. Osterloh, Margit & Rota, Sandra, 2007. "Open source software development--Just another case of collective invention?," Research Policy, Elsevier, vol. 36(2), pages 157-171, March.
    18. Michele Boldrin & David K. Levine, 2013. "The Case against Patents," Journal of Economic Perspectives, American Economic Association, vol. 27(1), pages 3-22, Winter.
    19. Popov, E. V. & Vlasov, M. V. & Shishkina, A. Yu. & Yakimova, A. V., 2016. "Institutional Analysis of Resource Potential for Knowledge Generation in the Enterprises of the Regional Defense-Industrial Sector," R-Economy, Ural Federal University, Graduate School of Economics and Management, vol. 2(3), pages 314-323.
    20. Leibowicz, Benjamin D., 2018. "Welfare improvement windows for innovation policy," Research Policy, Elsevier, vol. 47(2), pages 390-398.

    More about this item

    Keywords

    technological change; technology diffusion; knowledge sharing; collective invention; patents;
    All these keywords.

    JEL classification:

    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

    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:2017/28. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/labssit.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.