Never‐Ending Search for Innovation

ABSTRACT We provide a model of investment in innovation that is dynamic, features multiple heterogeneous research projects of which only one potentially leads to success, and in each period, the researcher chooses the set of projects to invest in. We show that if a search for innovation starts, it optimally does not end until the innovation is found—which will be never with a strictly positive probability.

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Publication Details

Journal
Journal of Industrial Economics
Published
2025-03-20
DOI
https://doi.org/10.1111/joie.12413
Primary Topic
Private Equity and Venture Capital
Type
article
Field-Weighted Citation Impact
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article

Never‐Ending Search for Innovation

Igor Letina, Jean‐Michel Benkert
Journal of Industrial Economics
Private Equity and Venture Capital
article

Never‐Ending Search for Innovation

Igor Letina, Jean‐Michel Benkert
article en

Abstract

ABSTRACT We provide a model of investment in innovation that is dynamic, features multiple heterogeneous research projects of which only one potentially leads to success, and in each period, the researcher chooses the set of projects to invest in. We show that if a search for innovation starts, it optimally does not end until the innovation is found—which will be never with a strictly positive probability.

Journal of Industrial EconomicsVol. 73(2)
University of Bern (CH), Centre for Economic Policy Research (GB)
Openalex Percentile: Top 93%
Private Equity and Venture Capital
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