nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2018‒01‒29
fourteen papers chosen by
João José de Matos Ferreira
Universidade da Beira Interior

  1. R&D and Innovation across Global Value Chains: Insights for EU Territorial Innovation Policy By Mafini Dosso; Lesley Potters; Alexander Tuebke
  2. Regional Knowledge, Entrepreneurial Culture and Innovative Start-ups over Time and Space - An Empirical Investigation By Michael Fritsch; Michael Wyrwich
  3. Good Times, Bad Times: Innovation and Survival over the Business Cycle By Elena Cefis; Orietta Marsili
  4. A statistical analysis of industrial penetration and internet intensity in Taiwan By Chia-Lin Chang; Yu-Chieh Wu; Michael McAleer
  5. Exploitation of Research Findings as a Source of Well-being By Kotiranta, Annu; Tahvanainen, Antti-Jussi
  6. Les réseaux d’innovation public-privé dans les services (RIPPS) : une nouvelle expression des réseaux d’innovation dans une économie des services et du développement durable By Faridah Djellal; Faïz Gallouj
  7. Public Funding and Corporate Innovation By Beck, Mathias; Junge, Martin; Kaiser, Ulrich
  8. Export Behavior of Turkish Manufacturing Firms Under Crises By Aslihan Atabek Demirhan; Hakan Ercan
  9. Knowledge Interactions in Regional Innovation Networks: Comparing Data Sources By Michael Fritsch; Mirko Titze; Matthias Piontek
  10. Cities and Entrepreneurs over Time: Like a Horse and Carriage? By Naudé, Wim
  11. The effect of cultural environment on entrepreneurial decisions By Morales, Marina; Velilla, Jorge
  12. Use of knowledge-intensive services in the Chilean wine industry By Farinelli, Fulvia; Fernández-Stark, Karina; Meneses, Javier; Meneses, Soledad; Mulder, Nanno; Reuse, Karim
  13. A three dimensional approach to regional Smart Specialization Strategy; An application to Puglia Region By Fiore, Annamaria
  14. Technological Innovation and Inclusive Growth in Germany By Naudé, Wim; Nagler, Paula

  1. By: Mafini Dosso (European Commission - JRC); Lesley Potters (European Commission - JRC); Alexander Tuebke (European Commission - JRC)
    Abstract: * Firms organise innovation activities across a wider range of geographically dispersed and specialized units, as compared to previous decades. Moreover corporate innovation processes are broken up into ever finer stages and tasks at the global scale. * The global dispersion of R&D and innovation activities occurs at a higher pace and goes hand in hand with a stronger regional polarization. Yet, corporate R&D remains a domestic activity, although functional and industry-specific patterns can be observed. * The increased internationalisation of R&D and innovation activities does not imply the hollowing-out of domestic ones. Foreign innovation activities may actually support domestic increases in innovation. * The internal and external connections of national and regional systems matter for their innovation performance. The quality of the regional learning and innovation systems is important to attract "relevant activities or segments" of the GVC. On the other hand, better connecting regions to the global innovation networks is important for local growth and employment. * The extent to which firms co-locate production and innovation activities depends on industry, product and process-specificities. * Evidence is needed on how R&D and innovation activities are sliced and diced across GVCs, on how these global corporate dynamics interact with national and regional innovation systems and on how they impact on local growth and employment.
    Keywords: R&D, Innovation Policy, Industrial Policy, Innovation.
    Date: 2017–09
  2. By: Michael Fritsch (FSU Jena); Michael Wyrwich (FSU Jena)
    Abstract: We investigate the role of entrepreneurship culture and the historical knowledge base of a region on current levels of new business formation in innovative industries. The analysis is for German regions and covers the time period 1907-2014. We find a pronounced positive relationship between high levels of historical self-employment in science-based industries and new business formation in innovative industries today. This long-term legacy effect of entrepreneurial tradition indicates the prevalence of a regional culture of entrepreneurship. Moreover, local presence and geographic proximity to a technical university founded before the year 1900 is positively related to the level of innovative start-ups more than a century later. The results show that a considerable part of the knowledge that constitutes an important source of entrepreneurial opportunities is deeply rooted in history. We draw conclusions for policy and for further research.
    Keywords: Innovative start-ups, universities, regional knowledge, regional cultures of entrepreneurship
    JEL: L26 L60 L80 O18 R12 R30
    Date: 2018–01–08
  3. By: Elena Cefis; Orietta Marsili
    Abstract: High-potential new ventures are a source of economic growth, which policy makers call upon in times of crisis when entrepreneurship is seen as a remedy to economic downturn. Yet at these times new ventures face intensified selection, and survival hinges on heterogeneous capabilities. We examine how the innovative capabilities of new firms created in the Netherlands in 2001-2006, affected their survival likelihood before, during and after the 2007-2008 global financial crisis. We estimate a piecewise exponential model linking survival times, observed in the time period from 2001 to 2015, to longitudinal innovation data from the CIS. Our results show that new ventures innovating within two years from founding benefit of a long-term adaptive survival premium during and after the crisis. This premium and its duration over the stages of the crisis are contingent to the form of innovation: technological innovations entail a more effective and enduring premium, as compared to managerial innovations, which can be even detrimental for survival. Our study has implications for entrepreneurial management, by highlighting how the development of innovative capabilities at founding, lays the foundations for organisational adaptation and resilience in the longer term. Furthermore, our results can inform a policy approach that aims at sheltering from the storm of a financial crisis, those new ventures that do possess the specific and necessary adaptive capabilities, but that are also vulnerable because of the liabilities of newness and smallness. Such an approach could help to maintain alive the process of entrepreneurial experimentation during the crisis, and to boost economic recovery, without dispersing precious resources.
    Keywords: firm survival; environmental jolts; financial crisis; organisational adaptation; technological and non-technological innovation
    Date: 2018–01–09
  4. By: Chia-Lin Chang (Department of Applied economics, Department of Finance National Chung Hsing University, Taiwan.); Yu-Chieh Wu (Department of Applied Economics National Chung Hsing University Taichung, Taiwan.); Michael McAleer (Department of Quantitative Finance National Tsing Hua University, Taiwan and Econometric Institute Erasmus School of Economics Erasmus University Rotterdam, The Netherlands and Department of Quantitative Economics Complutense University of Madrid, Spain And Institute of Advanced Sciences Yokohama National University, Japan.)
    Abstract: This paper investigates the effect of industrial penetration (geographic concentration of industries) and internet intensity (the proportion of enterprises that use the internet) for Taiwan manufacturing firms, and analyses whether the relationships are substitutes or complements. The sample observations are based on 153,081 manufacturing plants, and covers 26 two-digit industry categories and 358 geographical townships in Taiwan. The Heckman selection model is used to accommodate sample selectivity for unobservable data for firms that use the internet. The empirical results from two-stage estimation show that: (1) a higher degree of industrial penetration will not affect the probability that firms will use the internet, but will affect the total expenditure on internet intensity; (2) for two-digit SIC industries, industrial penetration generally decreases the total expenditure on internet intensity; and (3) industrial penetration and internet intensity are substitutes.
    Keywords: Industrial penetration, Internet intensity, Sample selection, Incidental truncation.
    JEL: D22 L60
    Date: 2018–01
  5. By: Kotiranta, Annu; Tahvanainen, Antti-Jussi
    Abstract: In Finland, universities have the explicit mandate to support the transformation of high-quality knowledge into profitable business, as well as to promote the creation of new businesses and workplaces within the boundaries of their so-called third mission. This report looks at how Finnish universities perform in the task. The results point at a clear lack of dedicated resources. The underlying reason is systemic: performance is not linked to incentives in the form of public university funding. Currently, resources for the implementation of the third mission are largely obtained via competition from external sources, endangering the continuity of the technology transfer function and creating disincentives to invest in its development. The lack of incentives is echoed among researchers: Nearly half of the scientists who, according to their own view, have made economically valuable findings state they do not find the time to promote their exploitation. The report proposes several remedies: (1) the performance of universities in their third mission needs to be metered. (2) These metrics need to be linked to earmarked public university funding; (3) Individual-level metrics concerning the exploitation of their findings should encourage researchers and promote their academic careers. In order to support more rapid cultural change, universities could (4) recruit professors directly from the business world; and (5) set up cooperative, joint laboratories with industry in their respective strategic research areas.
    Keywords: Technology transfer, third mission, commercialization, university, higher education
    JEL: O31 O32 O33 O38 O43 O52 D02 I23 I25 I28
    Date: 2018–01–22
  6. By: Faridah Djellal (CLERSE - Centre Lillois d’Études et de Recherches Sociologiques et Économiques - UMR 8019 - Université de Lille, Sciences et Technologies - ULCO - Université du Littoral Côte d'Opale - CNRS - Centre National de la Recherche Scientifique); Faïz Gallouj (CLERSE - Centre Lillois d’Études et de Recherches Sociologiques et Économiques - UMR 8019 - Université de Lille, Sciences et Technologies - ULCO - Université du Littoral Côte d'Opale - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The concept of innovation network (IN) is a well-established one that has been the object of an extensive literature. Our subject in this paper is a particular kind of innovation network, as yet relatively unknown but which is developing against the background of economies dominated by service industries; we term them public-private innovation networks in services (ServPPINs). Such networks involve collaborations between public and private service organisations in the field of innovation. They differ from traditional INs in several ways. Firstly, service providers are the main actors in the networks. Secondly the relationships between the public and the private actors lie at the heart of the analysis. Finally, non-technological innovation, which is often overlooked in the literature, is taken into account. This paper has a twofold purpose: first to examine the way in which the characteristics of ServPPINs can help to modify and enhance the traditional concept of IN, and second to draw any possible lessons there might be for public policy. It is based on both a literature survey and analysis of a database of ServPPINs case studies compiled in the course of the ServPPIN (Public Private Innovation Networks in Services) European project.
    Abstract: Le concept de réseau d'innovation est un concept bien établi qui a fait l'objet d'une abondante littérature. Nous nous intéressons dans ce travail à des réseaux d'innovations particuliers, encore peu connus, mais qui se développent dans une économie de service dominante : les réseaux d'innovation public-privé dans les services (RIPPS). Les RIPPS décrivent des collaborations entre organisations de services publiques et privées dans le domaine de l'innovation. Ils diffèrent des RI traditionnels de plusieurs manières. Tout d'abord, les prestataires de services y sont les acteurs principaux. Ensuite les relations entre les acteurs publics et privés sont placées au centre de l'analyse. Enfin, l'innovation non technologique, souvent négligée dans la littérature, y est prise en compte. L'objet de ce travail est, tout d'abord, d'examiner la manière dont les caractéristiques des RIPPS peuvent contribuer à modifier et enrichir le concept traditionnel de RI, et ensuite, d'en tirer d'éventuels enseignements en matière de politique publique. Ce travail s'appuie à la fois sur un bilan de la littérature et sur l'exploitation d'une base de données d'études de cas de RIPPS constituée dans le cadre du projet européen ServPPIN (Public Private Innovation Networks in Services).
    Date: 2017
  7. By: Beck, Mathias (ETH Zurich); Junge, Martin; Kaiser, Ulrich (University of Zurich)
    Abstract: We review and condense the body of literature on the economic returns of public R&D on private R&D and find that: (i) private returns to R&D appear to be large and larger than the returns to alternative investments; (ii) private R&D and R&D subsidies are positively correlated and there is no evidence for crowding out; (iii) R&D cooperation increases private R&D; (iv) there appear to exist complementarities between alternative sources of funding; (v) the mobility of R&D workers, particularly of university scientists, is positively related to innovation; (vi) there are many university spin-offs but these are no more successful than non-university spin-offs; (vii) universities constitute important collaboration partners and (viii) clusters enhance collaboration, patents and productivity. Key problems for economic policy advice are that the identification of causal effects is problematic in most studies and that little is known about the optimal design of policy measures.
    Keywords: R&D subsidies, R&D tax credits, cooperation, labor mobility, returns to R&D, university spin-offs, R&D clusters, public-private knowledge transfer
    JEL: C54 J6 I28 O3 L52
    Date: 2017–12
  8. By: Aslihan Atabek Demirhan; Hakan Ercan
    Abstract: Turkey experienced three economic crises in recent decades that provides natural experiment environment for researchers. In this paper, we studied the impact of recent three different economic crisis on export behavior of Turkish manufacturing firms using firm level annual panel data for 1990-2014 period. By investigating the impact of crisis on both the decision to become an exporter and volume of exports, export behavior of Turkish manufacturing firms under crisis is diagnosed. Estimation results reveal differentiated impact of different types of crisis on export behavior of Turkish manufacturing firms. According to the results, export boom observed with 1994 crisis was mainly due to the increase in extensive margin. Devaluated currency together with shrinking domestic demand in 1994 crisis lead to an increase in export propensity of the firms. Although sharp currency devaluation and domestic demand contraction supported incumbent exporters to increase their export volume, the accompanied credit crunch in 2001 crisis hindered entrance of new firms into export markets. Significant international trade collapse with 2008 global financial crisis caused declines in both export propensity and export volume of the Turkish manufacturing firms. These findings have implications on both what types of export promotion and incentives should be provided (or not) and to whom this assistance should be provided for dissimilar shocks in an emerging market economy like Turkey.
    Keywords: Export behavior, Crisis, Firm-level data, Turkey, Logit model, Selectivity correction
    JEL: F14 L25 C23 C25
    Date: 2018
  9. By: Michael Fritsch (FSU Jena); Mirko Titze (Halle Institute for Economic Research (IWH), Germany); Matthias Piontek (Friedrich Schiller University Jena, Germany)
    Abstract: The value of social network analysis is critically dependent on the comprehensive and reliable identification of actors and their relationships. We compare regional knowledge networks based on different types of data sources, namely, co-patents, co-publications, and publicly subsidized collaborative R&D projects. Moreover, by combining these three data sources, we construct a multilayer network that provides a comprehensive picture of intraregional interactions. By comparing the networks based on the data sources, we address the problems of coverage and selection bias. We observe that using only one data source leads to a severe underestimation of regional knowledge interactions, especially those of private sector firms and independent researchers. The key role of universities that connect many regional actors is identified in all three types of data.
    Keywords: Knowledge interactions, social network analysis, regional innovation systems, data sources
    JEL: O30 R12 R30
    Date: 2018–01–08
  10. By: Naudé, Wim (Maastricht University)
    Abstract: Entrepreneurship, being largely an urban phenomenon, co-evolves over time with cities. While this relationship is like a 'horse and carriage', it is not a straightforward one, more akin to 'love and marriage'. In this paper I explore the co-evolution of entrepreneurship and cities. First, I provide a stylized model of development wherein the rise of cities (urbanisation) is the outcome of the activities of entrepreneurs. Second, I provide a stylized overview of entrepreneurship and cities from earlier to later stages of development. In young cities a challenge for establishing an entrepreneurial ecosystem is the provision of infrastructure for business' connectivity and energy. Good urban planning and management skills, including urban policing and dealing with land disputes, may be amongst the most sorely needed in the emerging world today. At more intermediate and later stages of development, cities can become entrepreneurial hotspots and even 'global startup cities'. Three main challenges during these stages, as far as the role of entrepreneurs are concerned, relates to (i) rising property prices and rents, urban congestion and fierce business competition, (ii) environmental sustainability and (iii) the impacts of technology that could make centralization in cities for business purposes unnecessary. Entrepreneurs have important roles to play as property developers and in the creation of new business models and new markets. They can be the drivers of 'smart' cities, 'circular' cities, and of sub-urbanisation and secondary city growth. Over time not all cities, and their entrepreneurs, will necessarily continue to grow and prosper. There is nothing inevitable in the rise of any particular city and the prosperity of its entrepreneurs. Cities do not only generate, they also degenerate. I conclude that the heterogeneity, serendipity and context-specificity of global urbanisation implies that there is much that is still unknown about the specifics of the relationship between cities and its entrepreneurs over time.
    Keywords: entrepreneurship, urbanisation, development
    JEL: L26 L53 M13 O18 R10
    Date: 2017–12
  11. By: Morales, Marina; Velilla, Jorge
    Abstract: This paper empirically examines whether the cultural environment plays a role in entrepreneurial decisions in Europe, the United States, Canada, and Australia. To explore this issue, we use data from the Adult Population Survey (APS) of 2010 to 2015 provided by the Global Entrepreneurship Monitor (GEM). To calculate the cultural factor, we utilize data from the GEM National Expert Survey (NES) data and apply a probit model to measure the effect of culture based on an unobserved latent variable of satisfaction, measured through a dichotomous variable identifying entrepreneurs. Results show a positive and statistically significant relationship between the cultural factor and the individual choice of entrepreneurial activity, suggesting that cultural environment is important, especially in European and Mediterranean countries. Our findings are robust to the introduction of several country variables, and to the use of different subsamples. Further, they do not qualitatively depend on the age of individuals.
    Keywords: Entrepreneurship. Culture. Developed countries. GEM Data.
    JEL: L26
    Date: 2018–01–10
  12. By: Farinelli, Fulvia; Fernández-Stark, Karina; Meneses, Javier; Meneses, Soledad; Mulder, Nanno; Reuse, Karim
    Abstract: Over the past two decades, Chile has successfully developed its wine industry, being the world’s fourth largest exporter in 2015 with mostly medium-quality wines. In addition to well known key factors such as climate and soil conditions, (foreign direct) investment in firms, imports of specialized capital equipment and highly skilled human resources, this paper explores the role of 38 (knowledge intensive) services in five different segments of the wine value chain. On the basis of answers by 29 wine firms regarding services activities on a survey carried out for this study, firms indicate they outsource about the same share (34%) as they carry out in-house (32%), while another 15% is produced using a combination of both. The degree of subcontracting of services falls as one moves further along the segments of the value chain. Moreover, it seems that small and large firms fully or partially outsource about half of all services, while medium size firms outsource less.
    Date: 2017–12–31
  13. By: Fiore, Annamaria
    Abstract: The aim of this paper is to describe an analytical tool able to support policy makers in defining regional policy for entrepreneurship. Given the growing interest about the themes of smart specialization assigned as policy objectives to the Regions, focus of the paper is at the regional level. The three-dimensional strategic analysis considers simultaneously three kinds of data for each industrial sector: spatial concentration, cost competitiveness and export weight. Each of the three dimensions considered can be seen in turn as a specialization index since the data are related to the performance recorded at national level (benchmark). Depending on position (quarter) occupied by a specific sector in a graph, policy makers can have at one sight the relative weight of that sector in the regional economy and could have support in defining policies accordingly. As an application, the paper presents last official available data for Puglia manufacturing sectors (2013). Moreover, the analysis could be also simply utilised to realize temporal comparisons. As an example, comparison between data for 2008 and 2013 have highlighted how Puglia has lost competitive advantages over time due to the economic crisis. However, analysis also shows how, in the same years, careful sectorial policies implemented (aerospace) has enabled the Region to emerge in this medium-high technology market also at an international level. Once reached the full availability of homogeneous and internationally comparable data, the same analytical framework could be easily extended to assess the status of different national economies for drawing policy recommendations also at higher territorial levels.
    Keywords: Regional policy; Smart Specialization Strategy; Industrial specialization; Policy tool; Three-dimensional strategic analysis.
    JEL: O2 R1
    Date: 2016–09
  14. By: Naudé, Wim (Maastricht University); Nagler, Paula (Erasmus University Rotterdam)
    Abstract: Technological innovation has historically contributed to inclusive economic growth in Germany. In more recent decades, however, this contribution has weakened due to the declining impact of technological innovation on labor productivity growth. Fearing that this declining impact would undermine the international competitiveness of the economy, real labor compensation was progressively curbed since the mid-1990s. This occurred inter alia through the government's erosion of the social welfare state, as well as through offshoring and reduced fixed capital investment of the corporate sector. The outcome was rising income and wealth inequalities. Between the mid-1990s and 2010 the rise in wage inequality was faster in Germany than in the United States, the United Kingdom, and Canada. To restore inclusive growth, two broad policy measures are recommended: first, to have appropriate compensatory social welfare policies in place; and second, to improve the effectiveness of technological innovation to raise labor productivity. This paper identifies three reasons why technological innovation has become less and less effective:(i) historical legacies, (ii) weaknesses in the education system, and (iii) entrepreneurial stagnation. Improving the impact of technological innovations on labor productivity growth will require a more diversified education system, a deepening of active labor market policies, better immigration policies, and a greater contestability of markets. Ensuring these recommendations in a coordinated fashion suggests the need for an appropriate industrial-innovation policy.
    Keywords: entrepreneurship, Germany, inequality, innovation, social protection, technology
    JEL: D31 L26 O33 O38 O52
    Date: 2017–12

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