By Giorgio Barba Navaretti, Partha Dasgupta, Karl-Göran Mäler, Domenico Siniscalco
Is wisdom an financial sturdy? that are the features of the associations regulating the construction and diffusion of data? Cumulation of information is a key determinant of monetary development, yet just recently wisdom has moved to the middle of monetary research. fresh literature additionally offers profound insights into occasions like medical development, inventive and craft improvement which were hardly ever addressed as socio-economic associations, being the area of sociologists and historians instead of economists. This quantity adopts a multidisciplinary method of convey wisdom within the concentration of recognition, as a key fiscal issue.
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Additional resources for Creation and Transfer of Knowledge: Institutions and Incentives
Where? Why? How? 39 dynamic the local firm and the more appropriable is knowledge, could we reach a stage where the strategie interaction may induce firms to cooperate in the creation of new knowledge? Could we, therefore, move from hierarchical transfers to cooperation? The literature on R&D co-operative agreements between firms, can provide so me interesting suggestion to explore the likelihood of these agreements emerging in developing countries. 2 From hierarchy to equal footing: relevance of models on R&D joint ventures The literature has investigated rather thoroughly market incentives to undertake research and developmen~.
Vertical investments are fostered by trade liberalisation, inereasing labour eosts in the industrialised world and raising global eompetition. At the same time, dispersion of R&D aetivity appears to be inereasingly related to the need to exploit specifie and loealised teehnological knowledge or networks of innovation (CantweIl and Koteeha, 1993). These two trends may weIl be partially related. If a eountry tends to specialise in a given stage of produetion, we may at the same time expeet this country to develop related teehnological knowledge and R&D facilities.
Given the public good characteristics of knowledge, tbis cost is lower the bigher the share of knowledge capital on other costly assets. The more important the knowledge capital, though, the lower the cost of setting up a new production unit and the higher the licensee's incentive to defect in the second stage. Knowledge intensive multinationals will therefore prefer to set up a subsidiary. Tbis result holds if we assurne that subsidiaries can fully internalise knowledge. Ethier and Markusen also consider the case where dispersion of knowledge takes place in a subsidiary.