Domestic industrial learning externalities of innovation and imitation: informing industrial policy with cross-country evidence

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Lim, K.Y. ORCID: 0000-0003-1978-176X and Raza, A., 2020. Domestic industrial learning externalities of innovation and imitation: informing industrial policy with cross-country evidence. Economic Issues, 25 (1), pp. 61-85.

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Abstract

This study estimates four different domestic industrial learning externalities of and between imitation and innovation. Using highly disaggregated industrial data as measures for product varieties, we test for the relationship between imitation and innovation based on four theoretically informed, policy-relevant hypotheses. In sum, we document robust and statistically significant stepping-stone effect of imitation on innovation, and a reverse positive creative-imitation effect from innovation to imitation. Likewise, we also estimate positive within-sector learning effects for both innovation and imitation. These empirical findings have significant implications for industrial policies designed to foster innovation-driven growth, especially in middle-income and developing economies. JEL Classification: O11, O40, O47

Item Type:

Journal article

Publication Title:

Economic Issues

Creators:

Lim, K.Y. and Raza, A.

Publisher:

Economic Issues Education Trust

Date:

31 March 2020

Volume:

Number: