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Does the “New Economy” Change the Frontiers of the Large Corporation?

Published online by Cambridge University Press:  17 August 2016

Bruno Amable ,
Régis Breton  and
Xavier Ragot
Bruno Amable
Affiliation:
University of Paris X, MODEM and CEPREMAP
Régis Breton
Affiliation:
University of Paris X, FORUM
Xavier Ragot
Affiliation:
CEPREMAP
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Summary

This paper proposes a model of industrial innovation linked to financial liberalisation where agents are characterised by heterogeneous innovative abilities. Individual researchers may either be employed by a large firm and work together on the firm’s innovative project, or they may alternatively set up an individual firm in order to commercialise their own innovation. The large firm’s hiring decisions and the individual researcher’s decision to set up his own firm depends on the researcher’s innovative ability and on the financial conditions. Financial liberalisation leading to a lower cost of setting up a small firm will affect the size of the large firm and increase the number of small technology firms. A drop in the cost of starting a small firm may increase income inequality.

Résumé

Résumé

Cet article propose un modèle d’innovation industrielle liée à la libéralisation financière où les agents sont charactérisés par des capacités d’innovation hétérogènes. Les chercheurs individuels peuvent soit être employés par une grande entreprise et travailler ensemble sur un projet d’innovation de l’entreprise, soit créer une entreprise individuelle afin de commercialiser leur propre innovation. Les décisions d’embauche de la grande entreprise et la décision du chercheur individuel de créer sa propre entreprise dépendent de la capacité d’innovation du chercheur et des conditions financières. La libéralisation financière qui diminue le coût de la création d’une petite entreprise affecte la taille de la grande entreprise et accroît le nombre de petites firmes technologiques. Une baisse du coût de création d’entreprise peut augmenter l’inégalité des revenus.

Keywords

innovationfinanceindustrial organisationG10L11Innovationfinanceorganisation industrielleG10L11
Type
III. Finance
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 68 , Special Issue 1-2: The New Economy: Implications and Viability , 2002 , pp. 239 - 255
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2002 

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