Legal institutions, innovation and growth

Arbeitspapier

We analyze the relationship between legal institutions, innovation and growth. We compare a rigid (law set ex-ante) legal system and a flexible one (law set after observing current technology). The flexible system dominates in terms of welfare, amount of innovation and output growth at intermediate stages of technological development - periods when legal change is needed. The rigid system is preferable at early stages of technological development, when (lack of) commitment problems are severe. For mature technologies the two legal systems are equivalent. We find that rigid legal systems may induce excessive (greater than first-best) R&D investment and output growth.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 3489

Classification and Topics

• Classification: Wirtschaft ; Innovation; Research and Development; Technological Change; Intellectual Property Rights: General ; Institutions and Growth ; Economics of Regulation ; Policy Objectives; Policy Designs and Consistency; Policy Coordination
• Subject: legal system ; commitment ; flexibility ; innovation ; growth

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Anderlini, Luca ; Felli, Leonardo ; Immordino, Giovanni ; Riboni, Alessandro
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/46397
• Last update: 10.03.2025, 11:45 AM CET