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Diversity of innovative strategy as a source of technological performance

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  • Patrick LLERENA
  • Vanessa OLTRA

Abstract

This paper explores the impact of diversity of innovative strategy of firms upon the industrial dynamics through a micro-simulation model. We consider two types of firms each one being characterised by a specific innovative strategy. Basically we assume that some cumulative firms adopt an internal learning by searching strategy, while non-cumulative firms adopt an external learning strategy aiming at absorbing external sources of knowledge. The results show that the co-existence of these two types of firms leads to an oligopolistic structure characterised by asymmetries in the size of firms and high technological performances. Thus the diversity of innovative strategy generates a diversity in firms market shares and is a source of dynamic efficiency in the long run.

Suggested Citation

  • Patrick LLERENA & Vanessa OLTRA, 2001. "Diversity of innovative strategy as a source of technological performance," Working Papers of BETA 2001-12, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    • Handle: RePEc:ulp:sbbeta:2001-12
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    References listed on IDEAS

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    1. Cohen, Wesley M. & Levin, Richard C., 1989. "Empirical studies of innovation and market structure," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 18, pages 1059-1107, Elsevier.
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    More about this item

    Keywords

    Industrial dynamics; innovation; diversity; learning.;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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