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Welfare Implications of User Innovation

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Essays in Honor of Edwin Mansfield

Abstract

Innovation by users is now understood to be an important part of innovative activity in the economy. In this paper we explore the implications of adding innovation by users to existing models of social welfare that currently assume innovation by manufacturers only. We find this addition removes several inefficiencies, and that social welfare is likely to be increased by the presence of user innovation. Implications for policies that can impact users’ freedom to innovate are discussed.

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Author information

Authors and Affiliations

  1. Institute for Innovation Research, Technology Management and Entrepreneurship, University of Munich, Kaulbachstraße 45, D-80539, Munich, Germany

    Joachim Henkel

  2. MIT Sloan School of Managent Cambridge, MA, 02139, USA

    Eric von Hippel

Authors
  1. Joachim Henkel
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  2. Eric von Hippel
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Editor information

Editors and Affiliations

  1. Bryan School of Business and Economics, University of North Carolina at Greensboro, USA

    Albert N. Link

  2. Kennedy School of Government, Harvard University, Emeritus, USA

    F. M. Scherer

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Henkel, J., von Hippel, E. (2005). Welfare Implications of User Innovation. In: Link, A.N., Scherer, F.M. (eds) Essays in Honor of Edwin Mansfield. Springer, Boston, MA. https://doi.org/10.1007/0-387-25022-0_5

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