EconPapers    
Economics at your fingertips  
 

Macrodynamic Modeling of Innovation Equilibria and Traps

Sanchez-Carrera Edgar J. (), Giuseppe Travaglini () and Sebastian Ille
Authors registered in the RePEc Author Service: Edgar J Sánchez Carrera ()

The B.E. Journal of Macroeconomics, 2021, vol. 21, issue 2, 659-694

Abstract: We study the interplay between the decision of firms to innovate and human capital. Based on a dynamic evolutionary model, we show that in the presence of a high stock of human capital, an advanced economy can remain caught in an “innovation trap”. Following the literature on endogenous growth, R&D investments and human capital are modeled as strategic complements. Skilled workers increase productivity and enjoy a wage premium if they are employed in the R&D sector, while they receive the same wage as unskilled workers if they are employed in the production sector. We model the evolutionary dynamics of the share of innovative firms and human capital to determine the conditions under which an economy converges to a high, low or mixed state of innovation.

Keywords: behavioral macroeconomics; evolutionary dynamics; innovative firms; institutions and growth (search for similar items in EconPapers)
JEL-codes: C73 E20 I25 O12 O30 O43 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1515/bejm-2020-0258 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

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:bpj:bejmac:v:21:y:2021:i:2:p:659-694:n:13

Ordering information: This journal article can be ordered from
https://www.degruyter.com/view/j/bejm

DOI: 10.1515/bejm-2020-0258

Access Statistics for this article

The B.E. Journal of Macroeconomics is currently edited by Arpad Abraham and Tiago Cavalcanti

More articles in The B.E. Journal of Macroeconomics from De Gruyter
Bibliographic data for series maintained by Peter Golla ().

 
Page updated 2022-01-22
Handle: RePEc:bpj:bejmac:v:21:y:2021:i:2:p:659-694:n:13