Lecture Economics (19/e) - Chapter 11: Technology, R&D, and efficiency

After completing this chapter, students will be able to: Differentiate between invention, innovation, and technological diffusion; explain how entrepreneurs and other innovators further technological advance; summarize how a firm determines its optimal amount of research and development (R&D); relate why firms can benefit from their innovation even though rivals have an incentive to imitate it. 11W Technology, R&D, and Efficiency McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, I

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11W Technology, R&D, and Efficiency McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. Invention, Innovation and Diffusion • New and better products • Better ways of producing and distributing those products • Occurs over the very long run • Incentive - the pursuit of profits LO1 11W-2 Invention, Innovation and Diffusion Short Run • No change in technology, plant or equipment Long Run • No change in technology Very Long Run • Technology changes by R&D LO1 11W-3 Invention, Innovation and Diffusion • Invention – New product or process • Based on scientific knowledge • Patent protection • Innovation • Product or process innovation • Can’t be patented • Diffusion – Spread of innovation through imitation or copying LO1 11W-4 R&D Expenditures Basic Research 5% Applied Research (invention) 20% Development innovation and imitation 75% Science Resource Statistics , National Science Foundation www.nsf.gov. LO2 11W-5 ... - tailieumienphi.vn

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