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on Innovation |
| By: | Eftichios S. Sartzetakis (University of Macedonia (Greece)and University College of the Cariboo) |
| Abstract: | This paper develops a simple model of the automobile market, in which significant network and environmental externalities are present, and examines consumers' choice of technology. There are two types of technology: one that currently dominates the market but imposes significant environmental costs, and one that is expected to be introduced and has zero environmental costs. We find that, in the absence of policy intervention, the benefits of the installed base and the price diferentials in favour of the existing technology will deter new users from adopting the clean technology. We consider diferent tax policies that will induce adoption provided it is welfare warranted. First, we analyze a tax policy on the dirty technology with the tax revenues generated being used for general purposes.Under this case, we find that the tax, to induce adoption, will be greater than the marginal environmental damage. Second, we consider the tax revenue generated from the dirty technology to be earmarked towards a future subsidy to the clean technology. In this case, the tax is found to be lower than the case where revenues are used for general purposes and more interesting is the fact that the tax can be set equal to the marginal damage. Finally, we examine the case where the government credibly commits a revenue neutral tax/subsidy policy prior to the introduction of the clean technology and we find that the tax and the subsidy expenditures required could be lower relative to the case without precommitment. |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:cea:doctra:e2004_82&r=ino |
| By: | Ruslan Lukach; Joseph Plasmans; Peter M. Kort |
| Abstract: | This paper presents a dynamic model of a competitive R&D and production duopoly subject to knowledge spillovers. Two asymmetric firms operate for a limited period of time and dispose their knowledge capital in the end. Both firms and the social planner prefer the R&D-cooperative strategy over the competitive one regardless of the intensity of knowledge spillovers. Accumulation of knowledge capital results allows the monopolist to have lower marginal cost of production and charge a lower market price than a fully competitive duopoly. Being able to define the degree of knowledge exchange when creating a research joint venture, the firms do not necessary choose the highest degree of cooperation available. |
| Keywords: | innovation, R&D, spillovers, cooperation |
| JEL: | C72 D21 O31 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1395&r=ino |
| By: | Dolfsma, W. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University) |
| Abstract: | The music industry is currently subject to changes influenced by ongoing digitalisation and informatization that are unprecedented. Other sectors can expect to undergo in the near future what the media industry is going through now – the movie industry being a prime suspect. Each day, some 600,000 copies of movies are exchanged via the Internet, most of these in violation of the copyright laws. The disruptive nature of technological development makes that the market for entertainment products and other content undergoes fundamental changes. Where ‘content’ used to be exchanged attached to a physical carrier, increasingly it has the features of an information product. |
| Keywords: | internet market;digital content;product differentiation;price discrimination;consumer as subcontractor;product development; |
| Date: | 2004–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:eureri:30001460&r=ino |
| By: | Canoy,Marcel; Ours,Jan C. van; Ploeg,Frederick van der (Tilburg University, Center for Economic Research) |
| Abstract: | The tensions between books and book markets as expressions of culture and books as products in profit-making businesses are analysed and insights from the theory of industrial organisation are given. Governments intervene in the market for books through laws concerning prices of books, grants for authors and publishers, a lower value-added tax, public libraries and education in order to stimulate the diversity of books on offer, increase the density of retail outlets and to promote reading. An overview of the different ways by which countries differ in terms of market structures and government policies is given. Particular attention is paid to retail price maintenance. Due to differences between European countries it is not a good idea to harmonise European book policies. Our analysis suggests that the book market seems quite able to invent solutions to specific problems of the book trade and that, apart from promoting reading, there is little need for government intervention. |
| JEL: | Z11 D4 D6 L1 L4 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:200513&r=ino |
| By: | Vries,Frans P. de; Withagen,Cees (Tilburg University, Center for Economic Research) |
| Abstract: | A weak version of the Porter hypothesis claims that strict environmental policy provides positive innovation incentives, hence triggering improved competitiveness and securing environmental quality. In a comparative way, this paper empirically tests this hypothesis across countries by linking environmental stringency to innovation proxied by patents in the field of SO2 abatement over the period 1970-2000. Three different models of environmental stringency are examined. Two of these models do not reveal a positive significant effect on innovation as a result of increased stringency. In the theoretically preferred model, however, a positive relationship between environmental stringency and innovation is obtained. |
| JEL: | L51 L94 O31 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:200518&r=ino |
| By: | Pierre Regibeau; Katharine Rockett |
| Abstract: | We present survey results regarding a series of hypotheses on industry structure, regulation and patent policy towards GM food crops, focussing on the stages of the industry that generate innovations and approved products for sale to the farming sector. Licensing as a means of delegating litigation and regulatory costs comes out as one of the most consistent themes in our responses. We link this practice to a two-tiered industry structure, a weak relation between litigation threat and research trajectory, and a perception by our respondents that patents - as well as patent design - are "one step removed" from their research decisions. |
| Date: | 2005–01–13 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:591&r=ino |
| By: | Edquist, Harald (Dept. of Economic Statistics, Stockholm School of Economics) |
| Abstract: | Rapid price decreases for ICT-products in the 1990s have been largely attributed to the introduction of hedonic price indexes. Would hedonic price indexing also have large effects on measured price and productivity during other technological breakthroughs? This paper investigates the impact of hedonic and matched model methods on historical data for electric motors in Sweden 1900–35. The results show that during the productivity boom of the 1920s, current prices for electric motors decreased by 13.2 and 12.2 percent per year depending on whether hedonic or matched model price indexes were used. This indicates high productivity growth in the industry producing electric motors in 1920–29. In contrast to Sweden, the US annual total factor productivity growth was only, according to current best estimates, 3.5 percent in Electric machinery compared to 5.3 percent in manufacturing in 1920–29. However, hedonic price indexes were not used to calculate US productivity. Finally, it is shown that the price decreases for electric motors in the 1920s were on par with the price decreases for ICT-equipment in the 1990s, even if hedonic indexing is used. |
| Keywords: | Hedonic price index; Electric motor; Productivity growth; Electrification; ICT revolution; Productivity growth; General Purpose Technologies |
| JEL: | L60 N60 O10 O14 O33 O40 |
| Date: | 2005–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hastef:0586&r=ino |
| By: | Sadao Nagaoka |
| Abstract: | This paper first reviews how Japan has strengthened the protection of intellectual property rights (IPRs), focusing on the expansion of the patentable subject matter, the restriction of the possibility of compulsory licensing, stronger deterrence against infringement and the introduction of the doctrine of equivalents. Second, based on the statistical analysis of sector-level panel data, it shows that (1)R&D intensity of domestic industry, trademark licensing, cross-licensing and, to a smaller degree, monopoly provisions are the significant determinants of the incidence of high-royalty contracts, and (2)Stronger protection of intellectual property rights looks to have increased the incidence of high-royalty contracts in the latter part of 1990s in the Japanese industries for which patent is important for appropriability. |
| Keywords: | Intellectual property rights, Licensing contract, Appropriability, Patent |
| JEL: | F23 O34 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:hst:hstdps:d04-60&r=ino |
| By: | Alfonso Gambardella; Bronwyn H. Hall |
| Abstract: | We study the production of knowledge when many researchers or inventors are involved, in a setting where tensions can arise between individual public and private contributions. We first show that without some kind of coordination, production of the public knowledge good (science or research software or database) is sub-optimal. Then we demonstrate that if "lead" researchers are able to establish a norm of contribution to the public good, a better outcome can be achieved, and we show that the General Public License (GPL) used in the provision of open source software is one of such mechanisms. Our results are then applied to the specific setting where the knowledge being produced is software or a database that will be used by academic researchers and possibly by private firms, using as an example a product familiar to economists, econometric software. We conclude by discussing some of the ways in which pricing can ameliorate the problem of providing these products to academic researchers. |
| JEL: | O31 O34 L22 L86 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11120&r=ino |
| By: | Marie Thursby; Jerry Thursby; Emmanuel Dechenaux |
| Abstract: | University license contracts are more complex than the fixed fees and royalties typically examined by economists. We provide theoretical and empirical evidence that suggests milestones, annual payments, and consulting are common because moral hazard, risk sharing, and adverse selection all play a role when embryonic inventions are licensed. Milestones address inventor moral hazard without the inefficiency inherent in royalties. Royalties are optimal only when the licensee is risk averse. The potential for a licensee to shelve inventions is an adverse selection problem which can be addressed by annual fees if shelving is unintentional, but requires milestones if the firm licenses an invention with the intention to shelve it. Whether annual fees or milestones prevent shelving depends on the university credibly threatening to take the license back from a shelving firm. When such a threat is not credible an upfront fee is needed. This supports the rationale for Bayh-Dole march-in rights but also shows the need for the exercise of these rights can be obviated by contracts. |
| JEL: | D82 L14 O3 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11128&r=ino |
| By: | Chaaban, J.; Réquillart, V.; Trévisiol, A. |
| Abstract: | The paper aims to identify whether production characteristics, such as technical efficiency and returns to scale, affect takeovers. Applying a two-stage procedure on original panel data on french ceese manufacturers, the paper first estimates firm-specific productive efficiency and scale economies using Data Envelopment Analysis. The paper then uses the findings of the first stage to evaluate a random effects logit model of the determinants of takeover in the french cheese industry for the period 1985-2000. The paper finds that technical efficiency is not a significant determinat of takeovers, whereas the nature of scale economies is. Firms with Decreasing Returns to Scale (i. e. an over-sized production capacity) face a higher risk of takeover. This suggests that cheese manufacturers have been seeking to expand their milk processing capacities by acquiring large firms. This proves to be an indirect consequence of the non-transferable milk quota regime affecting the scarce milk input commodity. ...French Abstract : Ce papier vise à identifier si les caractéristiques de production, telles que l'efficacité et les économies d'échelle, affectent le rachat des entreprises. Appliquant une méthode à deux étapes sur des données originales de panel issue de l'industrie fromagère en France, on estime d'abord les économies d'échelles et l'efficacité technique pour chaque firme en utilisant la méthode Data Envelopment Analysis DEA. On utilise les résultats de la première étape pour estimer un modèle de logit aléatoire des déterminants du rachat des entreprises dans l'industrie fromagère française pour la période 1985-2000. Les résultats montrent que les économies d'échelle, et non l'efficacité technique, sont un facteur essentiel dans la décision d'acquisition d'une entreprise par une autre. On montre aussi que les entreprises rachetées ont des rendements décroissants (donc une structure et une taille relativement grande), des charges financières élevées (traduisant un certain endettement) mais ne constituent pas de coopératives. |
| Keywords: | TECHNICAL EFFICIENCY; TAKEOVERS; MARKET STRUCTURE; DATA ENVELOPMENT ANALYSIS; PANEL DATA; CHEESE INDUSTRY ; INDUSTRIE FROMAGERE; CONCENTRATION D'ENTREPRISES; MODELE; ECONOMIE D'ECHELLE; EFFICACITE; PANEL |
| JEL: | C23 L11 L66 |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:rea:inrawp:200416&r=ino |
| By: | A. VEREECKE; S. MUYLLE |
| Abstract: | Supply chain collaboration is claimed to yield significant improvements in multiple performance areas: it is believed to reduce costs, to increase quality, to improve delivery, to augment flexibility, to cut procurement cost and lead time, and to stimulate innovativeness. Yet empirical support for the relationship between supply chain collaboration and performance improvement is scarce. Our research adds to this emerging stream of research by providing empirical evidence from the engineering/assembly industries, based on data collected through the International Manufacturing Strategy Survey (IMSS) in Europe. The study reveals that supply chain collaboration is no guarantee for success: performance improvement is only weakly related to the extent of collaboration with customers or suppliers. However, strong improvers in multiple performance areas are found to be heavily engaged in collaboration projects with customers and suppliers, through extensive information exchange and higher levels of structural coordination. |
| Keywords: | supply chain management, collaboration, performance improvement |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:05/291&r=ino |
| By: | Mauro Napoletano, Domenico Delli Gatti, Giorgio Fagiolo, Mauro Gallegati |
| Abstract: | This paper studies how the interplay between technological shocks and financial variables shapes the properties of macroeconomic dynamics. Most of the existing literature has based the analysis of aggregate macroeconomic regularities on the representative agent hypothesis (RAH). However, recent empirical research on longitudinal micro data sets has revealed a picture of business cycles and growth dynamics that is very far from the homogeneous one postulated in models based on the RAH. In this work, we make a preliminary step in bridging this empirical evidence with theoretical explanations. We propose an agent-based model with heterogeneous firms, which interact in an economy characterized by financial-market imperfections and costly adoption of new technologies. Monte-Carlo simulations show that the model is able jointly to replicate a wide range of stylised facts characterizing both macroeconomic time-series (e.g. output and investment) and firms' microeconomic dynamics (e.g. size, growth, and productivity). |
| Keywords: | Financial Market Imperfections, Business Fluctuations, Economic Growth, Firm Size, Firm Growth, Productivity Growth, Agent-Based Models. |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2005/03&r=ino |