Friday, July 11, 2008
Posted by D. Daniel Sokol
Jim O'Connell of DOJ Antitrust recently gave a speech on Maximizing Incentives to Innovate Under China's Anti-Monopoly Law: Some Fundamental Principles. His big message to the Chinese authorities is:
- Innovation drives economic growth in developed economies because it promotes consumer welfare and economic efficiency through technological change in at least three important ways. First, innovation can lower costs through the creation of more efficient methods of production, distribution to markets, and delivery to consumers. Second, the introduction of new and better products can stimulate economic growth if they are products that consumers wish to buy. And third, the development of new technologies that leap over existing technologies can facilitate the entry of new competitors seeking to take the place of today's dominant firm.