nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2013‒05‒22
23 papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Knowledge Cumulability and Complementarity in the Knowledge Generation Function By Cristiano Antonelli; Alessandra Colombelli
  2. INNOVATION, REALLOCATION AND GROWTH By Daron Acemoglu; Ufuk Akcigit; Nicholas Bloom; William Kerr
  3. A framework for assessing innovation collaboration partners and its application to BRICs By Giuditta De Prato; Daniel Nepelski
  4. From Technological Catch-up to Innovation : The Future of China’s GDP Growth By Shahid Yusuf
  5. Differentiated Knowledge Bases and the Nature of Innovation Networks By Martin , Roman
  6. System Failures, Knowledge Bases and Regional Innovation Policies By Martin , Roman; Trippl , Michaela
  7. Multiproduct Multinationals and the Quality of Innovation By S. Bakhtiari; A. Minniti; A. Naghavi
  8. Why space matters in technological innovation systems – the global knowledge dynamics of membrane bioreactor technology By Binz , Christian; Truffer , Bernhard; Coenen , Lars
  9. Clean-tech Innovation in Emerging Economies: Transnational Dimensions in Technological Innovation System Formation By Gosens, Jorrit; Lu, Yonglong; Coenen , Lars
  10. Survival, Productivity and Growth of New Ventures across Locations By Lööf, Hans; Nabavi, Pardis
  12. Reassessing the spatial determinants of the growth of Italian SMEs By Roberto Gabriele; Diego Giuliani; Marco Corsino; Giuseppe Espa
  13. Renewal of mature industry in an old industrial region: regional innovation policy and the co-evolution of institutions and technology By Coenen , Lars; Moodysson , Jerker; Martin , Hanna
  14. Dynamics of Investment and Firm Performance: Comparative Evidence from Manufacturing Industries By Marco Grazzi; Nadia Jacoby; Tania Treibich
  15. The internationalisation of R&D: sectoral and geographic patterns of cross-border investments By Castelli , Cristina; Castellani, Davide
  16. Strategic Clustering and Competition by Alcohol Retailers: An Emperical Anlysis of Entry and Location Decisions By Yi Deng; Gabriel Picone
  17. MNC affiliation, knowledge bases and involvement in global innovation networks By J. Herstad , Sverre; Ebersberger , Bernd; Asheim, Bjørn
  18. Going for Smart Growth : Making Research and Innovation Work for Bulgaria By World Bank
  19. Statistical, Ecosystems and Competitiveness Analysis of the Media and Content Industries: The Newspaper Publishing Industry By Andra Leurdijk; Ottilie Nieuwenhuis; Mijke Slot
  20. Creative industries from an evolutionary perspective: A critical literature review By Jürgen Essletzbichler
  21. East Asian Growth: ICT for Growth and Cohesion in a Global Knowledge-based Economy By Frans A. van der Zee
  22. Cluster governance in the framework of cluster social responsibility By Mikhaylov, Andrey Sergeevich
  23. Relational Knowledge Transfers By Luis Garicano; Luis Rayo

  1. By: Cristiano Antonelli; Alessandra Colombelli
    Abstract: This paper explores the role of external knowledge and internal stocks of knowledge in the generation of new technological knowledge. It relies on the notion of recombination and brings together three concepts: the appreciation of current expenses in R&D activities; the analysis of the role of the stock of knowledge composition; the identification of the role of external knowledge available in the regional proximity. The empirical section is based upon a panel of companies listed on the main European financial markets for the period 1995–2006. The econometric analysis considers patents as a measure of the knowledge output and, on the right hand side, next to R&D expenditures, the stock of knowledge internal and external to each firm. The results confirm that the stock of internal knowledge and the access to external knowledge play a key role in assessing the actual capability of each firm to generate new knowledge.
    Keywords: knowledge generation function, knowledge stock, external knowledge, path dependence
    JEL: O30
    Date: 2013–04
  2. By: Daron Acemoglu; Ufuk Akcigit; Nicholas Bloom; William Kerr
    Abstract: We build a model of firm-level innovation, productivity growth and reallocation featuring endogenous entry and exit. A key feature is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using detailed US Census micro data on firm-level output, R&D and patenting. The model provides a good fit to the dynamics of firm entry and exit, output and R&D, and its implied elasticities are in the ballpark of a range of micro estimates. We find industrial policy subsidizing either the R&D or the continued operation of incumbents reduces growth and welfare. For example, a subsidy to incumbent R&D equivalent to 53 of GDP reduces welfare by about 1.53 because it deters entry of new high-type firms. On the contrary, substantial improvements (of the order of 53 improvement in welfare) are possible if the continued operation of incumbents is taxed while at the same time R&D by incumbents and new entrants is subsidized. This is because of a strong selection effect: R&D resources (skilled labor) are inefficiently used by low-type incumbent firms. Subsidies to incumbents encourage the survival and expansion of these firms at the expense of potential high-type entrants. We show that optimal policy encourages the exit of low-type firms and supports R&D by high-type incumbents and entry.
    Keywords: entry, growth, industrial policy, innovation, R&D, reallocation, selection.
    JEL: E2
    Date: 2013–04
  3. By: Giuditta De Prato (European Commission – JRC - IPTS); Daniel Nepelski (European Commission – JRC - IPTS)
    Abstract: In this paper, we develop a framework for assessing innovation collaboration partners. Based on the studies explaining the internationalisation of inventive activity, we identify four elements that are drivers of innovation collaboration: inventive capacity, technological specialization patterns, openness to international innovation collaboration and the economic potential of technology. In order to make the framework operational, we propose a set of patent-based indicators that capture the relevant elements. This way the proposed framework serves as a tool to both assess the potential of inventive collaboration and to anticipate benefits of such a collaboration. In a second step, we apply the framework to the analysis of the attractiveness of BRIC countries as potential partners for innovation collaboration. Our analysis shows that BRICs not only differ in terms of inventive performance, but also in terms of their openness to international collaboration, or the economic potential of technology developed by these countries.
    Keywords: collaborative innovation, science and technology collaboration, globalisation of technology, patent analysis, BRICs
    JEL: D8 F23 O14 O30 O57
    Date: 2012–01
  4. By: Shahid Yusuf
    Keywords: Information and Communication Technologies - ICT Policy and Strategies Private Sector Development - E-Business Technology Industry Social Protections and Labor - Labor Policies Education - Knowledge for Development Industry
    Date: 2012–01
  5. By: Martin , Roman (CIRCLE, Lund University)
    Abstract: It is argued in this paper that the nature of innovation networks can vary substantially with regard to the type of knowledge that is critical for innovation. Subject to the knowledge base of an industry, networks between companies can differ in various aspects, such as their geographical configuration, their structure, the type of actors holding a strategic position and the type of relations between actors. The paper comprises a conceptual discussion on social capital theory and networks, followed by a theoretically informed discussion on differentiated knowledge bases and innovation networks, which is subsequently illustrated with empirical material. The empirical analysis is based on social network analysis in association with exclusive data about patterns of cooperation and knowledge exchange in a number of regional industries located in different parts of Europe. The findings suggest that networks in analytical industries are not much constrained by geographical distance; knowledge is exchanged in a highly selective manner between research units and scientists in globally configured epistemic communities. Synthetic industries source knowledge within nationally or regionally configured networks between suppliers and customers, and within communities of practice. Symbolic industries rely on knowledge that is culturally defined and highly context specific, resulting in localised networks that are temporary and flexible in nature.
    Keywords: differentiated knowledge bases; regional innovation systems; social capital; social network analysis; knowledge networks
    JEL: B52 O25 P51 R11 R12 R58
    Date: 2013–05–03
  6. By: Martin , Roman (CIRCLE, Lund University); Trippl , Michaela (Department of Human Geography and CIRCLE, Lund University)
    Abstract: Regional innovation strategies rank on the top of public policy agendas today. There is a widespread consensus in both academic and policy circles that standardised “best practice” innovation policy models suffer from severe limitations and major shortcomings. The recent literature is replete with claims that regional innovation policies should be place-based and context-sensitive, taking into consideration the specificities of regions and their distinctive preconditions and capacities for innovation. Various conceptual approaches and theories support such a view. This paper discusses two concepts, which have a particularly strong potential for informing a differentiated regional innovation policy approach; the regional innovation system (RIS) theory and the knowledge base concept. The RIS literature highlights the importance of the organisational and institutional setting of a region and suggests that system deficiencies or failures should constitute the starting point for designing regional innovation policies. The differentiated knowledge base approach stresses that regional industries differ strongly in the underlying knowledge bases and, as a consequence, in their policy needs. We elaborate on the policy implications that originate from these concepts and argue that tailor-made regional innovation policies should consider both region-specific institutional set-ups and knowledge bases.
    Keywords: regional innovation policy; regional innovation system; differentiated knowledge bases
    JEL: L52 O21 O25 R11 R58
    Date: 2013–04–18
  7. By: S. Bakhtiari; A. Minniti; A. Naghavi
    Abstract: This research sheds light on the role of product scope on the innovation activity of multinational multi-product firms. We use patent citation data to break down innovation into two types by measuring the degree to which innovation performed by firms is fundamental and the extent to which the output of the R&D can be spread across different product lines. We focus on two features in multinational production: (i) fundamental innovation is geographically more difficult to transfer abroad to foreign production sites, (ii) learning spillovers can occur from international operations. The results reveal that the second effect is more likely to dominate when a firm is active in more product lines. We argue that a more diversified portfolio of products increases a firm’s scope of learning from international operations, thereby enhancing its ability to engage in more fundamental research. In contrast, firms with less product lines that geographically separate production from innovation shift the innovation activities towards more specialized types of innovation.
    JEL: F12 F23 O31 O32
    Date: 2013–05
  8. By: Binz , Christian (Swiss Federal Institute of Aquatic Science and Technology, Dübendorf, Switzerland); Truffer , Bernhard (Swiss Federal Institute of Aquatic Science and Technology, Dübendorf, Switzerland); Coenen , Lars (CIRCLE, Lund University; Nordic Institute for Studies in Innovation, Research and Education (NIFU), Norway)
    Abstract: Studies on technological innovation systems (TIS) often set spatial boundaries at the national level and treat supranational levels as a geographically undifferentiated and freely accessible global technological opportunity set. This article criticizes this conceptualization and proposes instead to analyze relevant actors, networks and processes in TIS from a relational perspective on space. It develops an analytical framework which allows investigating innovation processes (or ‘functions’) of a TIS at and across different spatial scales. Based on social network analysis of a co-publication dataset from membrane bioreactor technology, we illustrate how the spatial characteristics of collaborations in knowledge creation vary greatly over relatively short periods of time. This finding suggests that TIS studies should be more reflexive on system boundary setting both regarding the identification and analysis of core processes as well as in the formulation of policy advice.
    Keywords: technological innovation system; relational space; system functions; knowledge creation; social network analysis; membrane bioreactor technology
    JEL: O31 Q55
    Date: 2013–03–16
  9. By: Gosens, Jorrit (State Key Lab of Urban and Regional Ecology, Research Center for Eco-Environmental Sciences, Chinese Academy of Sciences b Graduate University of the Chinese Academy of Sciences, China); Lu, Yonglong (a State Key Lab of Urban and Regional Ecology, Research Center for Eco-Environmental Sciences, Chinese Academy of Sciences); Coenen , Lars (CIRCLE, Lund University; Nordic Institute for Studies in Innovation, Research and Education (NIFU), Norway)
    Abstract: Emerging economies increasingly contribute to global clean-tech innovation. The ‘Technological Innovation System’ (TIS) framework and its system functions have become a popular analytical tool for clean-tech innovation. Its applicability to emerging economies is not entirely straightforward, however, because of two interconnected flaws. First, empirical TIS work has focused predominantly on advanced economies. Second, although TIS is theoretically understood to be a global phenomenon, empirical TIS work often uses national borders as system boundaries. Earlier perspectives on innovation in emerging economies have stressed the role of transnational linkages in (early) innovative activities in emerging economies. While implicitly acknowledged, the TIS literature lacks a systematic specification of these transnational linkages, how and under what conditions they form, and how they induce or hamper TIS formation. This paper draws on insights from the perspectives of National Learning Systems, International Technology Transfer, and Global Production Networks to elaborate on the transnational dimension of TIS formation in emerging economies. The insights these strand of literature offer on the challenges and opportunities of such transnational linkages may be accurately grasped by the seven TIS system functions, lending credence to further application of the TIS framework in emerging economy case studies.
    Keywords: Technological innovation system; clean-tech; emerging economies; changing global innovation
    JEL: O31
    Date: 2013–03–10
  10. By: Lööf, Hans (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Nabavi, Pardis (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: We assess the impact of the location of genuinely new ventures and spinoffs on these firms’ survival, productivity and growth. The study distinguishes between four different categories of locations: metro cities, metro regions, urban areas, and rural areas. Using a unique database covering more than 23,000 new entrants between 2000 and 2004 in Sweden and observing them for 5 years, several conclusions may be drawn from our study. First, there is a substantial difference in ex-post entry performance between the manufacturing and service sectors. Second, the proposed superiority of start-ups by ex-employees depends on the performance measures and the sector. Third, knowledge and technology intensity of the industry matter for the viability of the new firms.
    Keywords: Location; New ventures; Survival; Productivity; Growth
    JEL: L25 L26 M13 O47 R11
    Date: 2013–05–08
  11. By: Gale Boyd; Mark Curtis
    Abstract: In this paper we merge a well-cited survey of firm management practices into confidential U.S. Census microdata to examine whether generic, i.e. non-energy specific, firm management practices, ”spillover” to enhance energy efficiency in the United States. We find the relationship in U.S. plants to be more nuanced than past research on UK plants has suggested. Most management techniques have beneficial spillovers to energy efficiency, but an emphasis on generic targets, conditional on other management practices, results in spillovers that increase energy intensity. Our specification controls for industry specific effects at a detailed 6-digit NAICS level and shows that this result is stronger for firms in energy intensive industries. We interpret the empirical result that generic management practices do not necessarily spillover to improved energy performance as evidence of an “energy management gap.”
    Date: 2013–04
  12. By: Roberto Gabriele; Diego Giuliani; Marco Corsino; Giuseppe Espa
    Abstract: The paper proposes a novel methodology to assess the role of ÒlocationÓ in shaping firm growth. Along with traditional determinants (e.g., age, size and financial constraints), geographical location is alleged to drive firm growth. The current literature typically relies on location variables that suffer from a lack of empirical robustness (Combes et al., 2008; Duranton and Overman, 2005; Arbia et al., 2012; Giuliani et al., 2012): indeed arbitrary definitions of the spatial observational units (such as provinces, regions or municipalities) introduce a statistical bias arising from the discretionally chosen definition of space. To address these shortcomings, we use the GetisÕ local K-function (Getis, 1984) at the firm level. This measure allows us to distinguish between Marshallian and Jacobs externalities. The analysis exploits a new database comprising single-unit Italian firms operating in the manufacturing sector. Empirical results show that firms exhibit a differential ability to grow due to different kinds of externalities: small firms benefit more from Marshallian externalities, while medium-large firms exploit also Jacobian externalities.
    Keywords: spatial concentration, GetisÕ local K-function, localization externalities
    JEL: L25 R11 O30
    Date: 2013
  13. By: Coenen , Lars (Nordic Institute for Studies in Innovation, Research and Education (NIFU), Oslo; CIRCLE, Lund University); Moodysson , Jerker (CIRCLE, Lund University); Martin , Hanna (CIRCLE, Lund University)
    Abstract: The objective of this paper is to further insights on the potentials and barriers for industrial renewal in locked-in regions and industries. To do so, the paper analyzes the Swedish policy program ‘Biorefinery of the Future’ (BioF). This initiative is geared to develop a strong regional innovation environment for forestry-based biorefinery development in the area of Örnköldsvik and Umeå in Northern Sweden. Theoretically, the paper draws on concepts from evolutionary economic geography regarding path-dependence, related variety and lockin, and combines these with institutional approaches found in science and technology studies to explain disruptive shifts or transitions in socio-technical systems.
    Keywords: Regional Innovation Policy; Old Industrial Regions; Evolutionary Economic Geography; Socio-technical Transitions
    JEL: O33 O38
    Date: 2013–05–06
  14. By: Marco Grazzi; Nadia Jacoby; Tania Treibich
    Abstract: Although the relation between investment and economic growth has been well established in the macroeconomic literature, the existence of a similar link at firm level has been challenged by empirical work. This paper investigates the channels linking investment and firm performance in the French and Italian manufacturing industries by proposing a novel methodology to identify investment spikes, which corrects for size dependence. While maintaining the desired properties of a spike measure, our chosen proxy accounts for the expected relation between investment and firm performance. Ex-ante, more efficient and fast growing firms demonstrate a higher probability to invest; in turn, following an investment spike, the group of investing firms shows further performance gains. We show also that expansionary investment episodes, proxied by the opening of new plants, have a negative effect on profitability but are associated with higher sales and higher levels of employment.
    Keywords: Firm heterogeneity, investment spike, industrial dynamics, corporate performance, capital accumulation, technical change
    JEL: C14 D22 D24 D92 E22 L11 L23 L60
    Date: 2013–04
  15. By: Castelli , Cristina (Italian Trade Promotion Agency (ICE), Csil Milano); Castellani, Davide (University of Perugia, Italy; CIRCLE; Sweden; IWH and LdA)
    Abstract: This paper presents the sectoral and geographic distribution of R&D-related activities, in comparison with manufacturing activities, by analysing data (from the fDi Markets database) on the number of cross-border greenfield investment projects. Results show that crossborder R&D investments are concentrated in fewer sectors and countries (of origin and destination) than manufacturing, and they are less sensitive to the obstacles related with the distance between home and host countries. More than the two-thirds of all cross-border investments in R&D-related activities are in ICT/Electronic and Life Sciences/Chemicals sectors, but these sectors differ in their propensity towards R&D and Design, Development and Testing activities. Almost half of the investments is due to multinationals from North America, and over one third from Western Europe, but the two areas show a different sectoral specialization. Considering the areas of destination, Asia is the largest recipient, and specializes in the ICT/Electronics and Industrial Machinery, while Western Europe ranks second and attracts relatively more research investments in Life Sciences/Chemicals, as well as in the Machinery industry
    Keywords: Internazionalization of R&D; Multinational Firms; Europe; North America; Asia
    JEL: F23 L23 O30
    Date: 2013–03–03
  16. By: Yi Deng (Department of Economics, University of South Florida); Gabriel Picone (Department of Economics, University of South Florida)
    Abstract: We develop and estimate a spatial game-theoretic model of entry and location choices to examine firms’ strategic clustering decisions. The model identifies two contradictory effects that determine firms’ geographical location choices: a competition effect and a clustering effect. We also separate firms’ strategic clustering incentives from the observed clustering behavior due to exogenous factors such as population and topographic desirability or constraints. In particular, we examine two closely related industries that share similar location limitations but have different strategic incentives to cluster, jointly estimate the Bayesian Nash equilibrium of a two-industry entry and location game, and quantify the strategic clustering incentives.
    JEL: L13 L81 R12 R30
    Date: 2013–01
  17. By: J. Herstad , Sverre (Nordic Institute for Studies in Innovation, Research and Education (NIFU), Oslo; CIRCLE, Lund University); Ebersberger , Bernd (MCI Management Center Innsbruck,Austria); Asheim, Bjørn (CIRCLE, Lund University)
    Abstract: Innovation collaboration is subjected to partner search and selection constraints. These constraints are reinforced by geographical distance, and mediated by privileged information accessed through pre-existing formal and informal ties to foreign business contexts. Multinational corporations may therefore influence the collaborative linkages maintained by their affiliates abroad, outside the group network. This paper shows that the sensitivity of foreign collaboration to resources provided by the parent group is dependent on whether affiliates of the multinational are engaged in developing cross-disciplinary, application-specific technological knowledge with a strong tacit content (e.g. systems engineering), knowledge with a strong aesthetic of cultural content (e.g. media or fashion) or knowledge dominated by specific scientific disciplines (e.g. biotechnology).
    Keywords: Multinational corporations; industrial knowledge bases; innovation collaboration; globalization
    JEL: F23 L24 O32
    Date: 2013–03–03
  18. By: World Bank
    Keywords: Information and Communication Technologies - ICT Policy and Strategies Agricultural Knowledge and Information Systems Private Sector Development - E-Business Tertiary Education Environmental Economics and Policies Education Environment Agriculture
    Date: 2012–01
  19. By: Andra Leurdijk (TNO); Ottilie Nieuwenhuis (TNO); Mijke Slot (TNO)
    Abstract: This report offers an in-depth analysis of the major economic developments in the music industry. It looks at music companies, and covers the production and distribution of recorded music, including online distribution, and the competition which these companies face from other online music providers. It also looks at the organisation of live performances and the exploitation of music copyright, though data on how these activities contribute to revenues in the sector are less systematically available. The analysis integrates data from this project’s statistical report and includes a database of the major music publishing companies plus two company case studies (EMI and Spotify). The report is divided into six chapters. Following the introduction in Chapter 1, Chapter 2 introduces the sector and its main economic and technological features. Chapter 3 analyses the value network of the music industry, identifying the transformations taking place in the value network and business model as a result of the on-going digitization process. Chapter 5 identifies the main regulatory issues affecting the economic position of the EU music publishing industry. Finally, Chapter 6 weighs the strengths and weaknesses of the European music publishing industry against the opportunities and threats posed by digitization and the internet. The study is based on a review and synthesis of the available literature and reports and on official (Eurostat) and unofficial (trade organisations and consultancies) data on the music publishing industry.
    Keywords: media industries, content industries, newspaper publishing
    Date: 2012–06
  20. By: Jürgen Essletzbichler
    Abstract: This paper builds on and complements work by evolutionary economic geographers on the role of industry relatedness for regional economic development and extends this work into a number of methodological and empirical directions. First, while recent work defines relatedness through co-occurrence, this paper measures relatedness as intensity of input-output links between industry pairs. Second, this measure is employed to examine industry evolution in 360 U.S. metropolitan areas over the period 1977-1997. The paper confirms the findings of existing work: Industries are more likely to be members of and enter and less likely to exit a metropolitan industry portfolio if they are technologically related to those industries. Third, based on average industry relatedness in a metropolitan area, an employment weighted measure of metropolitan technological cohesion is developed. Changes in technological cohesion can then be decomposed into selection, entry and exit effects revealing that the change in technological cohesion is not only due to the entry and exit of related industries but employment growth in strongly related incumbent industries.
    Keywords: Evolutionary economic geography, industry relatedness, industrial branching, technological cohesion, selection, entry, exit
    Date: 2013–05
  21. By: Frans A. van der Zee (TNO)
    Abstract: This report assesses what is new about Asian growth, focusing primarily on the ‘external’ dynamics of change (the roles of inter-country growth and networks, trade and FDI – i.e. the context of globalization).
    Keywords: Asia, Growth, China, Asian Economy, Asian crisis, ICT
    JEL: F01
    Date: 2012–08
  22. By: Mikhaylov, Andrey Sergeevich
    Abstract: --
    Keywords: international cluster,cluster governance,cluster social responsibility,Cyprus financial cluster,cluster crisis,regional economy
    JEL: E02 E61 F23 F43 G01 G38 H12
    Date: 2013–03–30
  23. By: Luis Garicano; Luis Rayo
    Abstract: An expert must train a novice. The novice initially has no cash, so he can only pay the expert with the accumulated surplus from his production. At any time, the novice can leave the relationship with his acquired knowledge and produce on his own. The sole reason he does not is the prospect of learning in future periods. The profit-maximizing relationship is structured as an apprenticeship, in which all production generated during training is used to compensate the expert. Knowledge transfer takes a simple form. In the first period, the expert gifts the novice a positive level of knowledge, which is independent of the players' discount rate. After that, the novice's total value of knowledge grows at the players' discount rate until all knowledge has been transferred. The inefficiencies that arise from this contract are caused by the expert's artificially slowing down the rate of knowledge transfer rather than by her reducing the total amount of knowledge eventually transferred. We show that these inefficiencies are larger the more patient the players are. Finally, we study the impact of knowledge externalities across players.
    Date: 2013–04

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