A note on Schumpeter’s innovation hypothesis

Dennis L. Weisman

Applied Economics Letters, 2023, vol. 30, issue 4, 496-500

Abstract: This note reveals that while the monopolist has ideal incentives to innovate, consistent with Schumpeter’s original hypothesis, the oligopolist’s incentive to innovate is non-monotonic in its market share and approaches that of the monopolist in the limit as the number of identical firms grows large. Numerical simulations indicate that the incentive to innovate for the relatively efficient oligopolist exceeds 83% of that of the monopolist. These findings may help explain why the purported relationship between innovation and firm size has defied consistent empirical validation.

Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/13504851.2021.1994914 (text/html)
Access to full text is restricted to subscribers.

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:taf:apeclt:v:30:y:2023:i:4:p:496-500

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20

DOI: 10.1080/13504851.2021.1994914

Access Statistics for this article

Applied Economics Letters is currently edited by Anita Phillips

More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().