Growth through Heterogeneous Innovations

By Ufuk Akcigit, William R. Kerr. Journal of Political Economy, 2018

612 citations recorded by the source corpus.

We build a tractable growth model in which multiproduct incumbents invest in internal innovations to improve their existing products, while new entrants and incumbents invest in external innovations to acquire new product lines. External and internal innovations generate heterogeneous innovation qualities, and firm size affects innovation incentives. We analyze how different types of innovation contribute to economic growth and the role of the firm size distribution. Our model aligns with many observed empirical regularities, and we quantify our framework with Census Bureau and patent data for US firms. Internal innovation scales moderately faster with firm size than external innovation.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/15bdb6140cd1403f8b5f54d775eb2708b967e99d

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Citations in the corpus

What Happened to US Business Dynamism? (2019, background): “In the spirit of Akcigit and Kerr (2018), this generalization of the innovation structure introduces heterogeneity in the size of innovations, depending on firm size.”
The End of Economic Growth? Unintended Consequences of a Declining Population (2020, background): “1Examples include Kremer (1993), Acemoglu (1998), Ngai and Samaniego (2011), Doepke and Zilibotti (2014), Acemoglu and Restrepo (2018), Akcigit and Kerr (2018), Atkeson and Burstein (2019), and Buera and Oberfield (2019).”
Innovation and firm growth: Does firm age play a role? (2016, positive): “Akcigit and Kerr (2010) provide empirical evidence from the US Census of Manufacturers that large firms engage more in incremental R&D, while small firms perform radical R&D – and we expect that a similar distinction can be made between old and young firms.”
The Rise of American Ingenuity: Innovation and Inventors of the Golden Age (2017, positive): “The higher share of international migrants we see in the top 10 inventive states is in line with Akcigit et al. (2016b)’s finding that inventors are internationally highly mobile.”
Financial development and innovation-led growth: Is too much finance better? (2020, methodology): “Inspired by the work of Klette and Kortum (2004) and Akcigit and Kerr (2018), where different types of innovations are introduced in a growth model, Philippe et al. (2018) argue that the introduction of financial development into these models may result in two competing effects. First, potentially g”
Technological Innovation, Resource Allocation and Growth (2017, background): “Our paper is related to the growing body of work that explores the link between innovation and firm growth dynamics (Caballero and Jaffe, 1993; Lentz and Mortensen, 2008; Akcigit and Kerr, 2010; Acemoglu, Akcigit, Bloom, and William, 2011).”
Heterogeneous Markups, Growth, and Endogenous Misallocation (2020, background): “This is qualitatively consistent with the findings reported in Akcigit and Kerr (2018). In absolute terms, R&D spending is of course increasing in size, i.”
Innovation and Top Income Inequality (2018, background): “Entrant patents have more citations than incumbent patents: For example in 1980, each entrant patent has 11.4 citations on average, whereas an incumbent patent only has 9.5 citations, which supports the view that entrant patents correspond to more radical innovations (see Akcigit and Kerr, 2017).”
Market Power and Innovation in the Intangible Economy (2019, methodology): “Akcigit and Kerr (2018) run this regression on Census data and find a β of -0.”
Connecting to Power: Political Connections, Innovation, and Firm Dynamics (2018, background): “These results on innovation are consistent with earlier findings on U.S. firms: using U.S. Census data, Akcigit and Kerr (2018) show that larger firms are less innovation-intensive and come up with less impactful innovation.”
Back to Basics: Basic Research Spillovers, Innovation Policy and Growth (2013, neutral): “Notable exceptions include Mansfield (1980, 1981), Griliches (1986) and Link (1981) which empirically document the positive contribution of basic research to firms’ productivity. Existing studies on basic research have been mainly theoretical and devoted their attention to academic/public research a”
Low Interest Rates, Market Power, and Productivity Growth (2019, background): “…literature include Acemoglu and Akcigit (2012), Akcigit and Peters (2021), Akcigit and Kerr (2018), Cabral (2018), Garcia-Macia, Hsieh and Klenow (2018), Acemoglu, Akcigit, Akp, Bloom and Kerr (2018), Aghion, Bergeaud, Boppart, Klenow and Huiyu (2018), and Atkeson and Burstein (2019), among others.”
Big data in finance and the growth of large firms (2018, background): “The topic of changes in the firm size distribution is a topic taken up in many recent papers, including Davis and Haltiwanger (2015), Kozeniauskas (2017), and Akcigit and Kerr (2017). In addition, a number of papers analyze how size affects the cost”