Abstract
Schumpeter’s ideas, which should be the basis of any evolutionary approach to the relations between innovation, competition and growth, are revisited and interpreted within the analytical framework proposed by Hicks in Capital and Time. Two main results emerge. First, the introduction of any new technology may lead to higher unemployment and reduced productivity; only an active monetary (and banking policy) will allow the economy to capture productivity gains. Second, within an industry confronted by recurrent technological changes, certain monopoly practices may be needed for this industry to converge towards an efficient market structure determined by the content of technology and the profile of demand. These results suggest some reconsideration of the macroeconomic and industrial or competition policies designed, in Europe, to cope with both technical change and globalization in modern economies.
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Notes
Model and simulations are described in the books and papers here quoted and can be provided upon request.
Model and simulations are described in the books and papers here quoted and can be provided upon request.
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This is the text of a Presidential Address delivered at the International Schumpeter Society meeting held in Sophia Antipolis in June 2006. It is based on long collaboration with my close friend Mario Amendola and is derived from our joint work published in many articles and books, which are included in the bibliography.
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Gaffard, JL. Innovation, competition, and growth: Schumpeterian ideas within a Hicksian framework. J Evol Econ 18, 295–311 (2008). https://doi.org/10.1007/s00191-008-0102-z
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DOI: https://doi.org/10.1007/s00191-008-0102-z