nep-ino New Economics Papers
on Innovation
Issue of 2005‒04‒09
ten papers chosen by
Koen Frenken
Universiteit Utrecht

  1. Density and strength of ties in innovation networks : a competence and governance view By Nooteboom,Bart; Gilsing,Victor A.
  2. Density and strength of ties in innovation networks : an analysis of multi-media and biotechnology By Gilsing,Victor A.; Nooteboom,Bart
  3. Entrepreneurial roles along a cycle of discovery By Nooteboom,Bart
  4. Innovation, learning and cluster dynamics By Nooteboom,Bart
  5. Empirical tests of optimal cognitive distance By Wuyts,Stefan; Colombo,Massimo G.; Dutta,Shantanu; Nooteboom,Bart
  6. Elements of a cognitive theory of the firm By Nooteboom,Bart
  7. The social and industrial dynamics of retailing an evolutionary reconstruction By Nooteboom,Bart
  8. An institutional sociology perspective of the implementation of activity based costing by Spanish health care institutions By Eriksen, Scott D.; Urrutia, Ignacio
  9. Co-operation among firms and communities : a new standardization process for the software industry (In French) By Marie CORIS (E3i, IFReDE-GRES)
  10. Technology Adoption From Hybrid Corn to Beta Blockers By Jonathan Skinner; Douglas Staiger

  1. By: Nooteboom,Bart; Gilsing,Victor A. (Tilburg University, Center for Economic Research)
    Abstract: Taking into account both competence and governance issues, and six dimensions of tie strength, this article argues that in networks for exploration there are good reasons, counter to the thesis of the 'strength of weak ties', for a dense structure of ties that are strong in most dimensions. By contrast, in exploitation networks there are good reasons for structures that are non-dense, with ties that are strong in other dimensions than in networks for exploration.
    JEL: L14
    Date: 2005
  2. By: Gilsing,Victor A.; Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: In this article we provide an empirical illustration of hypotheses, developed in the literature, on the role of density and strength of ties in innovation networks. We study both exploration and exploitation networks in the Dutch multimedia and pharmaceutical biotechnology industry. We find support for most of our hypotheses but not all. These findings, in line with the mixed results in the literature, seem to indicate that the distinction between exploration versus exploitation, albeit useful, is still too general. There may be a stronger sectoral effect in how exploration and exploitation settle in network structural properties than anticipated thus far.
    JEL: D23 D83 L14 L63 L65
    Date: 2005
  3. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: The literature on entrepreneurship recognizes a variety of entrepreneurial roles, and the question arises what roles are played when and by whom. In this article, roles are attributed to different stages of innovation and organizational development. A central theme is the relation between discontinuity, in radical innovation (exploration), and continuity, in application, diffusion and adaptation (exploitation). Use is made of a concept of a 'cycle of discovery', which seeks to explain how exploration leads on to exploitation, and how exploitation may yield exploration, in a step-by-step development towards radical innovation. Parallel to this there are processes of organisational development.
    JEL: D83 M13
    Date: 2005
  4. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: This chapter offers a theory and an analytical framework for the analysis of cluster dynamics, i.e. the innovative performance and evolution of clusters. It develops three types of embedding: institutional embedding, structural embedding (network structure), and relational embedding (type and strength of ties). The analysis is conducted from a perspective of both competence (learning) arising from relations and governance of relational risk, which includes risk of lock-in and risk of spillover. A basic proposition is that innovative clusters face the challenge of combining exploration and exploitation. Hypotheses are specified concerning differences between networks for exploration and exploitation, and concerning combinations and transitions between them. Arguments are presented that in some important respects go against the thesis of the strength of weak ties . Some empirical evidence is presented from recent studies.
    JEL: L14
    Date: 2005
  5. By: Wuyts,Stefan; Colombo,Massimo G.; Dutta,Shantanu; Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: This article provides empirical tests of the hypothesis of optimal cognitive distance , proposed by Nooteboom (1999, 2000), in two distinct empirical settings. Variety of cognition, needed for learning, has two dimensions: the number of agents with different cognition, and differences in cognition between them (cognitive distance). The hypothesis is that in interfirm relationships optimal learning entails a trade-off between the advantage of increased cognitive distance for a higher novelty value of a partner s knowledge, and the disadvantage of less mutual understanding. If the value of learning is the mathematical product of novelty value and understandability, it has an inverse-U shaped relation with cognitive distance, with an optimum level that yields maximal value of learning. With auxiliary hypotheses, the hypothesis is tested on interfirm agreements between pharmaceutical companies and biotech companies, as well as on interfirm agreements in ICT industries.
    JEL: D83 L24 L63 L65
    Date: 2005
  6. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: This paper presents elements of a cognitive theory of the firm, from the perspective of embodied cognition. It entails the notion of 'cognitive distance' between people that have developed their cognition in different environments. This yields the notion of the firm as a 'focusing device', to reduce cognitive distance for the sake of efficient collaboration and for the resolution of conflict. This focus yields organisational myopia, which needs to be compensated by outside relations, between firms, at some cognitive distance. Next, on the basis of principles derived from cognitive science, this paper tries to resolve the problem of combining structural stability and change, which in economics is known as the problem of combining exploitation and exploration. This provides the basis for a theory of learning and innovation in organisations and economies. The theory is elaborated on the basis of the notion of 'scripts', also derived from cognitive science.
    JEL: D21 D83 M13
    Date: 2005
  7. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: This paper reconstructs the long-term development of retailing, including industrial, economic and social antecedents and consequences. Among other things, it includes innovation in the form of the emergence and diffusion of successive novel types of shop (including self-service), relations between large and small firms in innovation and diffusion, change of demand conditions, institutional change concerning the opening time of shops, increase of scale and concentration, and social effects. For the analysis of the process and costs of retailing, use is made of queuing theory rather than customary production functions. The reconstruction is conducted in evolutionary terms of selection, variety generation and transmission. Scripts with nodes for component activities are used in analogy to chromosomes composed of genes. The paper concludes with a discussion of the usefulness of evolutionary economics, and offers suggestions for its development.
    JEL: B52 L22 L81 M13 O31 O33
    Date: 2005
  8. By: Eriksen, Scott D. (Instituto de Empresa); Urrutia, Ignacio (IESE Business School)
    Abstract: According to institutional sociology, hospitals will respond to external environmental pressures and adopt Activity-Based-Costing (ABC). This theory overemphasizes conformity and fails to consider the advantages of organizational non-conformance. A conflict of interests between physicians and management leads to physician resistance to accepting ABC. This paper investigates the Spanish government's response to this resistance by creating new public foundation hospitals, and involves a case study of the Alcorcón foundation hospital. Population ecology is offered as an explanation for the emergence of new entities as a result of inert existing entities' resistance to reform.
    Keywords: Activity based costing; ABC implementation; Health care; Institutional sociology; Spanish health care sector;
    Date: 2005–02–21
  9. By: Marie CORIS (E3i, IFReDE-GRES)
    Abstract: From a voluntary production, free software fulfil to be broadly diffused on the market side. The commercial success of these software is attented by an active participation in their development from a large number of firms. We explain this participation by the opportunities of free software development and intellectual property models for standardization process within the software industry. We analyze these opportunities by considering the cases of open consortiums where firms and communities cooperate for the creation of open software standards.
    Keywords: Software industry, Intellectual property, Standardization, Free Software, Consortiums
    JEL: L15 D23 O34
    Date: 2005
  10. By: Jonathan Skinner; Douglas Staiger
    Abstract: In his classic 1957 study of hybrid corn, Griliches emphasized the importance of economic incentives and profitability in the adoption of new technology, and this focus has been continued in the economics literature. But there is a distinct literature with roots in sociology emphasizing the structure of organizations, informal networks, and "change agents." We return to a forty-year-old debate between Griliches and the sociologists by considering state-level factors associated with the adoption of a variety of technological innovations: hybrid corn and tractors in the first half of the 20th century, computers in the 1990s, and the treatment of heart attacks during the last decade. First, we find that some states consistently adopted new effective technology, whether hybrid corn, tractors, or effective treatments for heart attacks such as Beta Blockers. Second, the adoption of these new highly effective technologies was closely associated with social capital and state-level 1928 high school graduation rates, but not per capita income, density, or (in the case of Beta Blockers) expenditures on heart attack patients. Economic models are useful in identifying why some regions are more likely to adopt early, but sociological barriers -- perhaps related to a lack of social capital or informational networks -- can potentially explain why other regions lag far behind.
    JEL: O3 I1
    Date: 2005–04

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