Knowledge Diffusion through Employee Mobility

April Franco () and Darren Filson ()

Claremont Colleges Working Papers from Claremont Colleges

Abstract: In high-tech industries, one important method of diffusion is through employee mobility: many of the entering firms are started by employees from incumbent firms using some of their former employers' technological know-how. This paper explores the effect of incorporating this mechanism in a general industry framework by allowing employees to imitate their employers' know-how. The equilibrium is Pareto optimal since the employees "pay" for the possibility of learning their employers' know-how. The model's implications are consistent with data from the rigid disk drive industry. These implications concern the effects of know-how on firm formation and survival.

Keywords: socio-political instability; endogenous growth; public investment; political economy of growth (search for similar items in EconPapers)
JEL-codes: P16 E62 O40 (search for similar items in EconPapers)
Date: 2000
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Persistent link: http://EconPapers.repec.org/RePEc:clm:clmeco:2000-61

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