2015 Articles
Leaders and followers: Perspectives on the Nordic model and the economics of innovation
What kinds of social and economic systems are most conducive to innovation? We formulate a simple model in which countries can close the gap with the technological leader, but where the cost of doing so may be so high that the country chooses to remain laggards. Observed disparities in productivity may be the result of a recognition that the cost of closing the gap exceeds benefit and there may therefore exist an international equilibrium in which there are leaders and followers. Even if it is granted that the United States is the leader and Scandinavia are followers, there are theoretical grounds for arguing that the Nordic model may in fact be better for innovation, suggesting that if the US adopted some of the Nordic institutions, innovations would be higher, and societal welfare would be improved even more.
Geographic Areas
Files
-
Leaders and followers Perspectives on the Nordic model and the economics of innovation.pdf application/pdf 401 KB Download File
Also Published In
- Title
- Journal of Public Economics
- DOI
- https://doi.org/10.1016/j.jpubeco.2014.09.005
More About This Work
- Academic Units
- Economics
- Published Here
- February 5, 2019
Notes
Also published as NBER Working Paper 20493, September 2014.