The distinction between codifiable and tacit knowledge is relevant to a firm's ability to appropriate the returns to its innovation because:
A)Technological progress involves advances in codifiable knowledge-hence it is more important
B)Patents and copyrights must be articulated clearly-hence they embody only codifiable knowledge
C)Tacit knowledge related primarily to traditional skills that are becoming increasingly irrelevant in today's digital economy
D)If an innovation lacks legal protection,then,if it based on tacit knowledge it cannot be easily be imitated

Question

Quizplus · Accepted Answer

If an innovation is based on tacit knowledge and lacks legal protection, it cannot be easily imitated. Tacit knowledge is often difficult to codify and transfer, giving a competitive advantage to firms that possess it. Therefore, firms that rely on tacit knowledge can appropriate returns from their innovations more effectively.

The Distinction Between Codifiable and Tacit Knowledge Is Relevant to a Firm's