Does Monopoly Promote Innovation? A Theoretical Vindication of the Schumpeterian Hypotesis

Denicolo', Vincenzo ; Delbono, Flavio (1992) Does Monopoly Promote Innovation? A Theoretical Vindication of the Schumpeterian Hypotesis. Bologna: Dipartimenti di Scienze economiche DSE, p. 25. DOI 10.6092/unibo/amsacta/5226. In: Quaderni - Working Paper DSE (134). ISSN 2282-6483.
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Abstract

In this paper we reconsider the well known Schumpeterian hypotesis stating the superiority of monopoly over competition in generating fast technological progress. This hypotesis has been challenged by Arrow (1962) and Dasgupta and Stiglitz (1980), who have shown that a monopolist has lower incentives to innovate. After reassessing arrow's and Dasgupta and Stiglitz's argumet, we show that their conclusion can be reserved and the Schumpeterian conjecture can be confirmed. More precisely, if by “competitive industry” we mean a large Cournot market, then, for small innovations, we show that a monopolist invests in R&D more than such an industry.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Denicolo', Vincenzo0000-0001-8371-4241
Delbono, Flavio0000-0001-9030-4048
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ISSN
2282-6483
DOI
Deposit date
22 Jun 2016 08:16
Last modified
22 Jun 2016 08:16
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