Inter-Sectoral Knowledge Diffusion and Scale Effects in Schumpeterian Growth Models

André Grimaud and Elie Gray

No 24-1577, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We formalize inter-sectoral knowledge diffusion in a standard fully endogenous Schumpeterian growth model. Each sector is simultaneously sending and receiving knowledge; thereby, to produce new knowledge, the research and development activity of each sector draws from a pool of knowledge which stems from this diffusion. This enables us to revisit the scale effects issue by revealing how this property (inconsistent with empirical evidence) relates with knowledge diffusion (the importance of which is empirically highlighted). We show that suppressing knowledge diffusion across sectors is a sufficient but not necessary condition for obtaining scale-invariancy. Then, we identify several sets of assumptions which enable us to obtain models which are reasonably consistent with empirical evidence both on scale effects and how knowledge diffuses in the economy. Specifically, these models do not exhibit scale effects (or at least not significant ones) while considering various scope of knowledge diffusion (including possible occurrence of general-purpose technologies).

Keywords: Schumpeterian growth theory, Scale effects, Knowledge diffusion, Knowledge; spillovers, Non rivalry,echnological distance (search for similar items in EconPapers)
JEL-codes: O30 O31 O33 O40 O41 (search for similar items in EconPapers)
Date: 2024-09-20
New Economics Papers: this item is included in nep-cse, nep-ent, nep-gro, nep-ino, nep-knm, nep-sbm, nep-tid and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.tse-fr.eu/sites/default/files/TSE/docu ... 2024/wp_tse_1577.pdf Full Text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:129742

Access Statistics for this paper

More papers in TSE Working Papers from Toulouse School of Economics (TSE) Contact information at EDIRC.
Bibliographic data for series maintained by ().