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Substitution and complementarity in endogenous innovation

Young, Alwyn (1993) Substitution and complementarity in endogenous innovation. Quarterly Journal of Economics, 108 (3). pp. 775-807. ISSN 0033-5533

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Abstract

The influence of Joseph Schumpeter's notion of 'creative destruction' may have led to an overemphasis on substitution between technologies in recent models of endogenous innovation. Historical examples of technological change suggest that new technologies may just as frequently complement older technologies, creating, rather than destroying, rents. Acknowledgement of the potential for both substitution and complementarity among inventions allows for a much richer characterization of the growth process, creating the possibility of threshold effects and multiple equilibria and bringing to the forefront the important role played by the expectations of inventive entrepreneurs.

Item Type: Article
Official URL: http://qje.oxfordjournals.org/
Additional Information: © 1993 the President and Fellows of Harvard College and the Massachusetts Institute of Technology
Library of Congress subject classification: H Social Sciences > HB Economic Theory
T Technology > T Technology (General)
Journal of Economic Literature Classification System: O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O10 - General
Sets: Departments > Economics
Collections > Economists Online
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 06 Apr 2011 13:23
URL: http://eprints.lse.ac.uk/33915/

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