Competition, Innovation and Distance to Frontier

Bruno Amable, Lilas Demmou and Ivan Ledezma

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Abstract: According to a recent literature, the positive effect of competition is supposed to be growing with the proximity to the technological frontier. Using a variety of indicators, the paper tests the effect of competition and regulation on innovative activity measured by patenting. The sample consists of a panel of 15 industries for 17 OECD countries over the period 1979-2003. Results show no evidence of a positive effect of competition growing with the proximity to the frontier. Two main configurations emerge. First, regulation has a positive effect whatever the distance to the frontier and the magnitude of its impact is higher the closer the industry is to the frontier. Second, the effect of regulation is negative far from the frontier and becomes positive (or non significant) when the technology gap decreases. These results contradict the belief in the innovation-boosting effect of product market deregulation such as taken into account in the Lisbon Strategy.

Keywords: concurrence; distance à la frontière technologique.; Innovation; competition; distance to frontier.; distance to frontier (search for similar items in EconPapers)
Date: 2008-07
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00340409
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Citations: View citations in EconPapers (2)

Published in 2008

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Related works:
Working Paper: Competition, Innovation and Distance to Frontier (2008)
Working Paper: Competition, innovation and distance to frontier (2008)
Working Paper: Competition, Innovation and Distance to Frontier (2007)
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