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The value of a new idea: knowledge transmission, workers' mobility and market structure

Marco Marini

MPRA Paper from University Library of Munich, Germany

Abstract: We model the process of knowledge transmission among firms via workers mobility as a multi-stage game. In our setup an idea to be realized needs that the agent informed about the idea recruits another agent from a pool of uninformed people. This constraint generates a recursive effect of knowledge transmission via players mobility across firms which affects simultaneously the players payoffs and the number of active players engaged in market competition. We provide sufficient conditions for the game to possess a unique symmetric subgame perfect equilibrium in which all incumbent players deter the exit of their collaborators. The equilibrium outcome is shown to depend upon the success of the idea over time, expressed by the behaviour of the market demand and on playerstime preferences. A few other intuitions are provided on the interplay between technology, market structure and the market value of an innovative idea.

Keywords: Innovation; Workers’ Mobility; Knowledge Transmission; Subgame Perfect Nash Equilibrium; Recursive Games (search for similar items in EconPapers)
JEL-codes: C70 L2 (search for similar items in EconPapers)
Date: 2005-07-10, Revised 2006-01
New Economics Papers: this item is included in nep-ino and nep-knm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in Chaos, Solitons and Fractals 29, 2006.29(2006): pp. 697-706

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