Knowledge Diffusion through Employee Mobility
Posted: 14 Aug 2008
Date Written: July 1, 2000
Abstract
In high-tech industries, one important method of diffusion is through employee mobility: many of the entering firms are started by employees from incumbent firms using some of their former employers' technological know-how. This paper explores the effect of incorporating this mechanism in a general industry framework by allowing employees to imitate their employers' know-how. The equilibrium is Pareto optimal since the employees "pay" for the possibility of learning their employers' know-how. The model's implications are consistent with data from the rigid disk drive industry. These implications concern the effects of know-how on firm formation and survival.
Keywords: Innovation, Diffusion, Research and Development, Industry Dynamics, Spinout, Techonological Change, Rigid Disk Drive
JEL Classification: L11, L63, J24, O31
Suggested Citation: Suggested Citation
April Franco (Contact Author)
University of Toronto - Rotman School of Management ( email )
105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada
Darren Filson
Claremont McKenna College - Robert Day School of Economics and Finance ( email )
500 E. Ninth Street
Claremont, CA 91711
United States
HOME PAGE: http://www.cmc.edu/academic/faculty/profile/darren-filson