Resource title

Exploration and exploitation: the role of entrepreneurship and R&D in the process of innovation

Resource image

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Resource description

We formulate a model that explicitly separates two functions in the innovation process: The introduction of new goods and the quality improvement of existing goods. While the latter is performed by the corporate R&D sector, the first is performed by entrepreneurs. We show that in a three sector economy, which also includes a producing sector, there exists a stable non trivial allocation of labor to production, innovation and entrepreneurship. We compute the steady state allocation of labor to production, R&D and Entrepreneurship. We show that the innovation rate decreases if one of the innovative sectors does not exist.

Resource author

Max Keilbach, Mark Sanders

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25680

Resource license

Adapt according to the presented license agreement and reference the original author.