Endogenous Product Cycles

Gene Grossman and Elhanan Helpman

Economic Journal, 1991, vol. 101, issue 408, 1214-29

Abstract: The authors construct a model of the product cycle featuring endogenous innovation and technology transfer. Competitive entrepreneurs in the industrialized North introduce new products whenever the expected present value of oligopoly profits exceeds the cost of product development. In the middle-income South, entrepreneurs devote resources to learning the production processes that have been developed in the North. The authors study the determinants of the long-run rate of growth of the world economy and the long-run rate of imitation. They also study the effects of exogenous events and of public policy on relative wage rates in the two regions. Copyright 1991 by Royal Economic Society.

Date: 1991
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Related works:
Working Paper: ENDOGENOUS PRDUCT CYCLES (1989)
Working Paper: ENDOGEMOUR PRODUCT CYCLES (1989)
Working Paper: Endogenous Product Cycles (1989)
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