TY  - JOUR
AU  - Akcigit, Ufuk
AU  - Kerr, William R
TI  - Growth Through Heterogeneous Innovations
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 16443
PY  - 2010
Y2  - November 2010
DO  - 10.3386/w16443
UR  - http://www.nber.org/papers/w16443
L1  - http://www.nber.org/papers/w16443.pdf
N1  - Author contact info:
Ufuk Akcigit
Department of Economics
University of Chicago
1126 East 59th Street
Saieh Hall, Office 403
Chicago, IL 60637
E-Mail: uakcigit@uchicago.edu

William R. Kerr
Harvard Business School
Rock Center 212
Soldiers Field
Boston, MA 02163
Tel: 617/496-7021
E-Mail: wkerr@hbs.edu
AB  - We study how exploration versus exploitation innovations impact economic growth through a tractable endogenous growth framework that contains multiple innovation sizes, multi-product firms, and entry/exit. Firms invest in exploration R&D to acquire new product lines and exploitation R&D to improve their existing product lines. We model and show empirically that exploration R&D does not scale as strongly with firm size as exploitation R&D. The resulting framework conforms to many regularities regarding innovation and growth differences across the firm size distribution. We also incorporate patent citations into our theoretical framework. The framework generates a simple test using patent citations that indicates that entrants and small firms have relatively higher growth spillover effects.
ER  -