Spillovers and the competitive pressure for long-run innovation

  title={Spillovers and the competitive pressure for long-run innovation},
  author={A. B. Reis and Daniel A. Traca},
  journal={European Economic Review},
This paper discusses the impact of oligopolistic product markets for innovation and growth, highlighting a novel, fundamental role of spillovers. We develop a model of endogenous growth with non-tournament R&D, where spillovers raise the relative R&D efficiency of laggards. A key feature is that the rate of innovation and the market configuration (i.e. the distribution of market shares) are jointly determined. Our results emphasize the role of spillovers in sustaining the competitive pressure… Expand