Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/22861
Authors: 
Pittnauer, Sabine
Hohnisch, Martin
Stauffer, Dietrich
Year of Publication: 
2003
Series/Report no.: 
Bonn econ discussion papers 2003,11
Abstract: 
This paper applies the theory of aspiration adaptation to industrial economics. It is motivated by the question, frequently raised in the context of theoretical and empirical research on industrial innovation, of what triggers a firm`s innovative activity. We develop a model of the management`s decision-making relating a firm`s competitive behavior, in particular the decision to start the development of a new product generation, to the current and past values of the firm`s growth rate and profitability. This linkage offers an alternative perspective on the incentives for innovation. Furthermore, we explore the relationship between firm size and innovativeness resulting from our model.
Subjects: 
Aspiration Adaption
Bounded Rationality
Product Innovation
JEL: 
L11
D21
O31
L25
L21
Document Type: 
Working Paper

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