Abstract Technological spillovers may have positive and negative effects. Following the approach of Muller and Haag (1996) , the author studied the market share and survive of firms during technological spillover situation. From the simulation, it was shown the large increases in innovation activities (innovation pushes) could be caused by spillover effects without the existence of random events. Besides random events, an increase in know do/innovation success could occur by the use of the concentration of the labor force and knowledge base of several firms and the scientific system. The result supposed by Silverberg (1998) that the timing of adoption of an innovation has an important impact on the development of future market share was confirmed through the simulation. If innovations are adopted too early, a lower market share is gained than when the adoption takes place at the optimal time, depending on the current stock of knowledge.
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