An Inquiry Into the Rationale for Economic Espionage^*

Abstract

Economic espionage can yield desirable strategic effects as well as cost savings for firms in a spying country. The spying country will typically gain even though counter-espionage operations will often be conducted by target countries. When two producing countries spy on each other, it is possible that both will be better off because of the technology transfer which is implicit in espionage. Economic espionage is generally beneficial to consumers. [F12, O031]