New growth theory and empirical study have shown that in-house R&D has the dual role, which not only generates new information, but also enhances the firm's ability to assimilate and exploit technology spillovers. Based on two faces of R&D we put forward a cellular automata model to investigate the complexity of the innovation diffusion of economic system in the long run. The simulation results show that the roles of in-house R&D and network externality on the average rate of innovators in the economic system own the characteristics of S-shaped curve. Increasing the level of in-house research may shorten the take-off phase of the economy and improve the stability of the long run level of innovation rate.
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