Review of Economic Studies Vol. 49 No. 4 1982

Invention and Innovation Under Alternative Market Structures: The Case of Natural Resources

Partha Dasgupta¹; Richard J. Gilbert²; Joseph E. Stiglitz³

¹ London School of Economics and Political Science · ² University of California, Berkeley · ³ Princeton University

Abstract

This paper examines the interactions between market structure and resource allocation over time when there is endogenous technical progress. The structures considered are a planned economy, pure monopoly, and competition with patent rights. In an efficient allocation the date of invention coincides with the date of innovation (the date at which technology is used). This is also true with a pure monopoly, but monopoly retards technical progress relative to the efficient level. Competition for patents rights to a new technology results in excessively rapid technical progress if the resource endowment of the economy is sufficiently large. Also, competition may lead to “sleeping patents” where invention strictly precedes the date of innovation.

DOI

10.2307/2297287

Volume

49

Issue

4

Pages

567

Sources

openalex crossref

Cite

APA 7 MLA 9 Chicago (author–date) Harvard Elsevier Harvard (JFE, JBF…) The Accounting Review Academy of Management American Marketing Association INFORMS (Management Science) Copy citation Copied ✓