Knowledge Spillovers and Inequality
- (pp. 1290-1307)
Abstract
We develop a dynamic model with knowledge spillovers in production. The model contains two opposing forces. Imitation of other firms helps followers catch up with leaders, but the prospect of doing so makes followers want to free ride. The second force dominates and creates permanent inequality. We show that the greater are the average spillovers and the easier they are to obtain, the greater is the free-riding and inequality. More directed copying raises inequality by raising the free-riding advantages of hanging back. Using Compustat and patent-citation data we find that copying is highly undirected.Citation
Eeckhout, Jan, and Boyan Jovanovic. 2002. "Knowledge Spillovers and Inequality ." American Economic Review, 92 (5): 1290-1307. DOI: 10.1257/000282802762024511JEL Classification
- D33 Factor Income Distribution
- O30 Technological Change; Research and Development; Intellectual Property Rights: General
- D83 Search; Learning; Information and Knowledge; Communication; Belief
- O34 Intellectual Property and Intellectual Capital