TY  - GEN
AB  - In this paper we examine to what extent market conditions facilitating start-up
formation affect technical change and firms' profits. We consider a model in which
R&D efforts of an incumbent firm generate partly tacit technological know-how
embodied in a key R&D employee, who might use it to form a start-up. The
availability of complementary assets influences whether new firms are created and
determine expected profits for start-up-founders. A large availability of complementary
assets has the direct effect that the generation of start-ups is fostered.
However, as a strategic effect, the incentives of incumbent firms to invest in R&D
might be reduced because of the increased danger of knowledge loss occurring
through start-up formation. We fully characterize the effects of an increase in the
availability of complementary assets, showing under which conditions the effects
on innovative activities and industry profits are negative.
DA  - 2013
DO  - 10.4119/unibi/1861142
KW  - Tacit Knowledge
KW  - Complementary Assets
KW  - Technological Change
KW  - R&D Effort
KW  - Start-Up Creation
LA  - eng
PY  - 2013
SN  - 2196-2723
SP  - 33-
TI  - Complementary Assets, Start-Ups and Incentives to Innovate
UR  - https://nbn-resolving.org/urn:nbn:de:0070-pub-18611425
Y2  - 2024-11-22T05:59:44
ER  -