Organisational Dimensions of Innovation

Sandrine Labory

Economics Working Papers from European University Institute

Abstract: This paper examines the theorical rationale for a new form of organisation appearing in the car industry. This form is characterised by horizontal as well as vertical communication, incentives based on ability rather than on productivity, and a cooperation of the divisions of large corporations. I show in a duopoly model that such horizontal information flows are optimal when the production technology is flexible, that is when there are large factor complementarities. This organisational form enabled Japanese producers to maintain a competitive advantage in terms of time-to-market and rate of product renewal. Therefore, innovation is not only technological, but also organisational.

Keywords: DUOPOLIES; INDUSTRIAL ORGANIZATION (search for similar items in EconPapers)
JEL-codes: D43 L00 (search for similar items in EconPapers)
Pages: 30 pages
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:eui:euiwps:eco97/07

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