How Rapidly Does New Industrial Technology Leak Out?

Abstract

There have been no systematic empirical studies of the speed at which various kinds of technological information leak out to rival firms. To help fill this gap, data were obtained from 100 American firms. According to the results, information concerning development decisions is generally in the hands of rivals within about 12 to 18 months, on the average, and information concerning the detailed nature and operation of a new product or process generally leaks out within about a year. These results have important implications both for incentives for innovation and for public policies aimed at stemming the outflow of technology.