Process spillovers and growth

Research output: Journal PublicationArticlepeer-review

6 Citations (Scopus)


This paper develops an R&D based endogenous growth model in which the firm's free-riding behavior, prompted by an incomplete technological protection at the industry level, can drive economic growth. Unlike existing endogenous growth models, it shows how free-riding behavior and process spillovers can mutually promote dynamic competition at the industry level and how they constitute a major source of growth in the economy. In the dynamic general equilibrium model that we propose, the representative industry is a duopoly that consists of a leader who innovates and a laggard who freerides by exploiting the source of intraindustry spillover. The main results show that the innovation strategies of the two firms can be dynamically strategic complements if a large technology gap prevails and that a fall in the level of technological protection can enhance economic growth.

Original languageEnglish
Pages (from-to)315-335
Number of pages21
JournalJournal of Optimization Theory and Applications
Issue number2
Publication statusPublished - Nov 2008
Externally publishedYes


  • Applied differential games
  • Endogenous growth
  • Imitation
  • Innovation
  • Spillovers
  • Technology gap

ASJC Scopus subject areas

  • Management Science and Operations Research
  • Control and Optimization
  • Applied Mathematics


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