|
on Technology and Industrial Dynamics |
| By: | Eklund, Johan (Jönköping International Business School (JIBS) and CESIS); Wiberg, Daniel (Jönköping International Business School (JIBS) and CESIS) |
| Abstract: | Economic theory tells us that abnormal firm and industry profits will not persist for any significant length of time. Any firm or industry making profits in excess of the normal rate of return will attract entrants and this competitive process will erode profits. However, a substantial amount of research has found evidence of persistent profits above the norm. Barriers to entry and exit, is an often put forward explanation to this anomaly. In the absence of, or with low barriers to entry and exit, this reasoning provides little help in explaining why these above-norm profits arise and persist. In this paper we explore the links between the systematic search for knowledge and the persistence of profits. By investing in research and development firms may succeed in creating products or services that are preferred by the market and/or find a more cost efficient method of production. Corporations that systematically invest in research and development may, by doing this, offset the erosion of profits and thereby have persistently high profits which diverge from the competitive return.We argue that even in the absence of significant barriers to entry and exit profits may persist. This can be accredited to a systematic search for knowledge through research and development. |
| Keywords: | Persistence of Profits; Profit Dynamics; R&D; Innovation Activity; Knowledge |
| JEL: | C10 C32 O10 O32 |
| Date: | 2007–03–13 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0085&r=tid |
| By: | Mario Denni |
| Abstract: | This paper addresses the determinants of diffusion of broadband infrastructure by looking at the U.S. Federal States. It tries to identify in particular to what extent intra- and inter -platform competition contribute to accelerating the speed of diffusion. Panel data analysis results indicate that both types of competition significantly affect the rate of diffusion, although with different effect. Intra-platform competition seems to have a positive impact only initially on the rate of diffusion but then dissipates. For the longer term, inter -platform has a much more important role in driving the rate of diffusion. The study takes account of the impact of other variables measuring competition in the telecommunications sector as well. |
| Keywords: | Broadband; Technological diffusion; Regulation and competition |
| JEL: | L1 L86 L96 O3 |
| URL: | http://d.repec.org/n?u=RePEc:rtr:wpaper:0060&r=tid |
| By: | Marco Vivarelli (Università Cattolica Piacenza, CSGR Warwick, Max Planck Institute of Economics Jena and IZA) |
| Abstract: | According to the "compensation theory", market forces should assure a complete compensation of the initial labour-saving impact of process innovations. In this paper a critique of this approach is proposed through a detailed survey of the theoretical and empirical literature on the subject. The general conclusion is that - although compensation is always working - the complete counter-balancing of dismissed workers cannot be assumed ex-ante. |
| Keywords: | innovation, technological unemployment, compensation |
| JEL: | J64 O33 |
| Date: | 2007–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2621&r=tid |