Abstract. In this study, I examine immaterial property rights in an economy where R&D firms innovate and imitate and households face non-diversifiable risk. Some property rights postpone the expected time an innovation will be imitated (e.g. increase the “length” of an innovation), while the others protect the imitator’s profits after a successful imitation (i.e. increase the “width” of an innovation). The main findings are as follows. Property rights that generate “short” and “wide” innovations also speed up economic growth. The smaller the households’ rate of risk aversion, the “longer” and “narrower” the welfare-maximizing innovations.
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