Idea Diffusion and Property Rights

50 Pages Posted: 2 Oct 2020

See all articles by Boyan Jovanovic

Boyan Jovanovic

New York University - Department of Economics

Zhu Wang

Federal Reserve Banks - Federal Reserve Bank of Richmond

Multiple version iconThere are 2 versions of this paper

Date Written: August, 2020

Abstract

We study the innovation and diffusion of technology at the industry level. We derive the full dynamic paths of an industry’s evolution, from birth to its maturity, and we characterize the impact of diffusion on the incentive to innovate. The model implies that protection of innovators should be only partial due to the congestion externality in meetings in which idea transfers take place. We fit the model to the early experiences of the automobile and personal computer industries both of which show an S-shaped growth of the number of firms.

Keywords: Technology, Innovation

Suggested Citation

Jovanovic, Boyan and Wang, Zhu, Idea Diffusion and Property Rights (August, 2020). FRB Richmond Working Paper No. 20-11, Available at SSRN: https://ssrn.com/abstract=3701997 or http://dx.doi.org/10.21144/wp20-11

Boyan Jovanovic (Contact Author)

New York University - Department of Economics ( email )

19 w 4 st.
New York, NY 10012
United States

Zhu Wang

Federal Reserve Banks - Federal Reserve Bank of Richmond ( email )

P.O. Box 27622
Richmond, VA 23261
United States

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