nep-ino New Economics Papers
on Innovation
Issue of 2005‒11‒05
sixteen papers chosen by
Koen Frenken
Universiteit Utrecht

  1. "Persistent Adoption of Time-Saving Process Innovations." By James G. Mulligan; Nilotpal Das
  2. Labor Pooling in R&D Intensive Industries By Heiko Gerlach; Thomas Rønde; Konrad O. Stahl
  3. Job Hopping in Silicon Valley: Some Evidence Concerning the Micro-Foundations of a High Technology Cluster By Brice Fallick; Charles A. Fleischmann; James A. Rebitzer
  4. Knowledge Compensation in the German Automobile Industry By Uwe Cantner; Kristina Dreßler; Jens J. Krüger
  5. From localized to corporate excellence: How do MNCs extract, combine and disseminate sticky knowledge from regional innovation systems? By Poul Houman Andersen; Poul Rind Christensen
  6. The value of knowledge spillovers By Yi Deng
  7. Nihon seizogyo ni okeru R&D katsudo to seisansei: Kigyo level data ni yoru jisshobunseki (in Japanese) By Tomohiko Inui; Hyeog Ug Kwon
  8. Analysing European and International Patent Citations: A Set of EPO Patent Database Building Blocks By Hélène Dernis; Dietmar Harhoff; Karin Hoisl; Colin Webb
  9. Biodiscovery and Intellectual Property Rights: A Dynamic Approach to Economic Efficiency By Tom Dedeurwaerdere; Vijesh Krishna; Unai Pascual
  10. The Undergraduate as an Engaged Explorer By Gerry Boyle; Finbarr Bradley
  11. Learning About a New Technology: Pineapple in Ghana By Timothy G. Conley; Christopher R. Udry
  12. Policies Affecting Indonesia's Industrial Technology Development By Thee Kian Wie
  13. Barriers to network-specific innovation By Antoine Martin; Michael J. Orlando
  14. Has New Zealand benefited from its investments in research & development? By Robin Johnson; W A Razzak; Steve Stillman
  15. ICT and Economic Growth: A Quantification of Productivity Growth in Spain 1985-2002 By Matilde Mas; Javier Quesada
  16. U.S. v. Microsoft: Did Consumers Win? By David S. Evans; Albert L. Nichols; Richard Schmalensee

  1. By: James G. Mulligan (Department of Economics,University of Delaware); Nilotpal Das
    Abstract: This paper is a draft of a chapter in a forthcoming book entitled, The Economics of Persistent Innovators,to be published by Springer. We consider the persistent adoption of innovations by firms that are not directly involved in the innovation process. In addition to a survey of the literature, we offer empirical evidence of persistent adoption for a specific time-saving process innovation: high-speed detachable chairlifts.
    Keywords: Innovation, Diffusion, Service, Quality
    JEL: L8 O3
    Date: 2005
  2. By: Heiko Gerlach (University of Auckland,; Thomas Rønde (University of Copenhagen, CEBR, and CEPR,; Konrad O. Stahl (University of Mannheim, CEPR, CESifo, and ZEW,
    Abstract: We investigate firms’ incentives to locate in the same region to gain access to a large pool of skilled labor. Firms engage in risky R&D activities and thus create stochastic product and implied labor demand. Agglomeration in a cluster is more likely in situations where the innovation step is large and the probability for a firm to be the only innovator is high. When firms cluster, they tend to invest more and take more risk in R&D compared to spatially dispersed firms. Agglomeration is welfare maximizing, because expected labor productivity is higher and firms choose a more effcient, technically diversified portfolio of R&D projects at the industry level.
    JEL: L13 O32 R12
    Date: 2005–09
  3. By: Brice Fallick; Charles A. Fleischmann; James A. Rebitzer
    Abstract: In Silicon Valley's computer cluster, skilled employees are reported to move rapidly between competing firms. This job-hopping facilitates the reallocation of resources towards firms with superior innovations, but it also creates human capital externalities that reduce incentives to invest in new knowledge. Using a formal model of innovation we identify conditions where the innovation benefits of job-hopping exceed the costs from reduced incentives to invest in human capital. These conditions likely hold for computers, but not in most other settings. Features of state law also favor high rates of inter-firm mobility in California. Outside of California, employers can use non-compete agreements to inhibit mobility, but these agreements are unenforceable in California. Using new data on labor mobility we find higher rates of job-hopping for college-educated men in Silicon Valley's computer industry than in computer clusters located out of the state. Mobility rates in other California computer clusters are similar to Silicon Valley's, suggesting some role for state laws restricting non-compete agreements. Consistent with our model of innovation, we also find that outside of the computer industry, California's mobility rates are no higher than elsewhere.
    JEL: R12 L63 O3 J63 J48
    Date: 2005–10
  4. By: Uwe Cantner (University of Jena, Faculty of Economics); Kristina Dreßler (University of Jena, Faculty of Economics); Jens J. Krüger (University of Jena, Faculty of Economics)
    Abstract: Knowledge is one of the most important determinants in single-industry studies of firm survival over the life cycle. Different kinds of knowledge, namely post-entry experience, pre-entry experience, and knowledge acquired by innovative activity positively influence the survival chances of firms. This paper investigates how the kinds of knowledge are able to compensate for each other. Therefore, a statistical survival analysis is performed for the German automobile industry which applies a new approach that combines the Cox regression with instrumental variable estimation. The results show that innovative activity is able to compensate for lacking post-entry experience, supporting Schumpeterian creative destruction.
    Keywords: firm survival, patents, innovation, automobile industry, hazard rates
    JEL: L10 L62 O33 C41
    Date: 2005–09–26
  5. By: Poul Houman Andersen; Poul Rind Christensen
    Abstract: MNCs and regional innovation systems differ widely in their knowledge generation and dissemination processes. We propose these differences provide systematic challenges for MNC units tapping into locally vested skills, combining their findings with existing knowledge and disseminating this internally. Our aim is to develop a framework for conceptualising the knowledge transfer process between MNCs and regional innovation systems. For that purpose we develop a conceptual model of the knowledge tapping process and a set of propositions.
    Keywords: MNCs; Knowledge management; Industrial districts
    JEL: D83 F23
    Date: 2005
  6. By: Yi Deng
    Abstract: This paper aims at quantifying the economic value of knowledge spillovers by exploring information contained in patent citations. We estimate a market valuation equation for semiconductor firms during the 1980s and 1990s, and find an average value in the amount of $0.6 to 1.2 million "R&D-equivalent" dollars for the knowledge spillovers as embodied in one patent citation. For an average semiconductor firm, such an estimate implies that the total value of knowledge spillovers the firm received during the sample period could be as high as half of its actual total R&D expenditures in the same period. This provides a direct measure of the economic values of the social returns or externalities of relevant technological innovations. We also find that the value of knowledge spillovers declines as the size of the firm's patent portfolio increases, and that self citations are more valuable than external citations, indicating a significant amount of tacit knowledge or know-how spillovers that occur within the firm.
    Keywords: Patents ; Research and development ; Semiconductor industry
    Date: 2005
  7. By: Tomohiko Inui; Hyeog Ug Kwon
    Keywords: R&D, productivity, panel data
    JEL: O30 L60 C23
    Date: 2005–10
  8. By: Hélène Dernis; Dietmar Harhoff; Karin Hoisl; Colin Webb
    Abstract: This paper presents a preliminary set of European and international citation data tables designed to enable researchers to become familiar with the subject and undertake a range of analyses. It addresses analytical and statistical issues such as why citations from international searches and European searches should be combined; the calculation of citation lags; use of International Patent Classification (IPC) codes for grouping patents according to technology; treatment of references to Non-Patent Literature (NPL); and the notion that many publications, from different patenting authorities, covering the same invention can be cited. Differences between US and European citations are also discussed. <P>L'analyse des citations de brevets Européens et internationaux Ce document présente une première sélection de données sur les citations européennes et internationales. Ces modules ont été construits afin de permettre aux chercheurs de se familiariser avec les citations et d'engager un certain nombre d’analyses. Plusieurs questions analytiques et statistiques sont abordées, notamment : pourquoi combiner les citations issues des recherches internationales avec celles des recherches européennes ; calculer des délais de citation ; utiliser les codes de la Classification internationale des brevets (CIB) pour regrouper les brevets par technologies ; comment considérer les références à la littérature non-brevet (NPL) ; et comment comptabiliser les citations lorsque plusieurs brevets, publiés par différents offices de brevet, pour la même invention sont cités. Les divergences entre citations américaines et européennes sont également étudiées.
    Date: 2005–10–18
  9. By: Tom Dedeurwaerdere (Centre de Philosophie du Droit (CPDR), Université Catholique de Louvain, Belgium); Vijesh Krishna (Faculty of Agricultural Sciences, University of Hohenheim, Germany); Unai Pascual (Department of Land Economy, University of Cambridge, UK)
    Abstract: This paper examines the use the use of economic incentives for knowledge generation through biodiscovery, in the particular case of the use of a highly valuable biogenetic resource stock from the South for industrial/research input. The focus is on a dynamic approach to contracting and property rights building upon insights from institutional and ecological economics. Two important conclusions come out of this analysis. First, it highlights the necessity to go beyond standard market approaches to economic valuation in order to address the issues of future possibilities of use and innovation and the integration of the different stages in the process of value creation. Second, it shows the necessity of developing alternatives to the current intellectual property rights regime, including systems for appropriate protection of the traditional knowledge of local communities.
    Keywords: food security, Bioprospection, genetic resources, traditional knowledge, Kani model, benefit sharing
    Date: 2005–06
  10. By: Gerry Boyle (National University of Ireland, Maynooth); Finbarr Bradley (National University of Ireland, Maynooth)
    Abstract: This paper asserts that most undergraduates leave Irish universities short-changed, never having been exposed to the riches of research. A re-conceptualisation of the research university is proposed, one founded on a culture of inquiry, interdisciplinarity and innovation. Scholarship is expanded to include engagement with communities, utilising the academy's unique multidisciplinary environment. It is argued that creativity and exploration should be essential elements in every undergraduate experience. A specific programme is used to exemplify how a responsible, civic and sustainable innovation culture can guide research and self-discovery, helping students understand how developing their own ventures can create value in society
    Date: 2005–09
  11. By: Timothy G. Conley; Christopher R. Udry (Economic Growth Center, Yale University)
    Abstract: This paper investigates the role of social learning in the diffusion of a new agricultural technology in Ghana. We use unique data on farmers’ communication patterns to define each individual’s information neighborhood, the set of others from whom he might learn. Our empirical strategy is to test whether farmers adjust their inputs to align with those of their information neighbors who were surprisingly successful in previous periods. We present evidence that farmers adopt surprisingly successful neighbors’ practices, conditional on many potentially confounding factors including common growing conditions, credit arrangements, clan membership, and religion. The relationship of these input adjustments to experience further supports their interpretation as resulting from social learning. In addition, we apply our methods to input choices for another crop with known technology and they correctly indicate an absence of social learning effects.
    Keywords: Social Learning, Technology, Innovation
    JEL: O31 O12 O13
    Date: 2000–07
  12. By: Thee Kian Wie
    Date: 2005–09
  13. By: Antoine Martin; Michael J. Orlando
    Abstract: We examine incentives for network-specific investment and the implications for network governance. We model an environment in which participants that make payments over a network can invest in a technology that reduces the marginal cost of using the network. A network effect results in multiple equilibria; either all agents invest and network usage is high or no agents invest and network usage is low. When commitment is feasible, the high-use equilibrium can be implemented; however, when commitment is infeasible, fixed costs associated with use of the network-specific technology result in a holdup problem that implements the low-investment equilibrium. Thus, governance structures necessary to achieve commitment will be preferred to those necessary merely to achieve coordination. For example, mutual ownership by network users may emerge where users face risk of ex post renegotiation. Such a governance structure will also be sufficient to avoid the network effect.
    Keywords: Investments ; Equilibrium (Economics) ; Payment systems
    Date: 2005
  14. By: Robin Johnson (Consultancy); W A Razzak (Department of Labour); Steve Stillman (Motu Economic and Public Policy Research)
    Abstract: We use panel data for nine industries to evaluate research and development (R&D) investments in New Zealand over the past forty years. We estimate the impact of R&D stocks in a particular industry on output per person in that industry and on output per person in the rest of the economy. We examine both public and private R&D investments. Privately provided R&D has a statistically significant positive impact on own- industry output per person, suggesting it increases productivity. However, publicly provided R&D has no impact on own-industry output per person. There is also evidence that private R&D in certain industries positively affects output per person in the rest of the economy, i.e. it generates positive spillovers. There is no evidence of positive spillovers from publicly provided R&D.
    Keywords: R&D Spillovers Productivity
    JEL: O11 O47 C13
    Date: 2005–10–31
  15. By: Matilde Mas; Javier Quesada
    Abstract: Using new sectoral data on investment and capital services we carry out a growth accounting exercise on Spain 1985-2002. We compute the contribution to output and labour productivity growth of employment, non-ICT and ICT capital, labour qualification and Total Factor Productivity. Results are given for 29 different branches; individually and grouped into four clusters according to their ICT use intensity. Three ICT assets (hardware, communications and software) are considered. We find that although the ICT intensive group appears to be the most dynamic cluster, most of the impact on productivity is still to come. There is some evidence of a reversal of the productivity slow down of the nineties starting in the year 2000. En utilisant de nouvelles données sectorielles sur les investissements et services de capital, nous menons à bien un exercice de comptabilité de croissance de l’Espagne entre 1985 et 2002. On calcule la contribution à la croissance et la productivité du travail, de l’emploi du capital TIC et non TIC, de la qualification de main d’oeuvre et de la productivité globale des facteurs. Les résultats sont donnés pour 29 différentes branches, individuellement et réparties en quatre groupes, selon l’intensité d’utilisation de leur TIC. Trois actifs des TIC sont considérés (le matériel, les communications et les logiciels). Nous trouvons que bien que le groupe le plus intensif en TIC apparaisse comme le plus dynamique, un impact encore plus important sur la productivité est attendu. En 2000, on constate une certaine accélération de la croissance de la productivité après le ralentissement des années 90.
    Date: 2005–08–17
  16. By: David S. Evans; Albert L. Nichols; Richard Schmalensee
    Abstract: U.S. v. Microsoft and the related state suit filed in 1998 appear finally to have concluded. In a unanimous en banc decision issued in late June 2004, the D.C. Circuit Court of Appeals rejected challenges to the remedies approved by the District Court in November 2002. The wave of follow-on private antitrust suits filed against Microsoft also appears to be subsiding. In this paper we review the remedies imposed in the United States, in terms of both their relationship to the violations found and their impact on consumer welfare. We conclude that the remedies addressed the violations ultimately found by the Court of Appeals (which were a subset of those found by the original district court and an even smaller subset of the violations alleged, both in court and in public discourse) and went beyond them in important ways. Thus, for those who believe that the courts were right in finding that some of Microsoft's actions harmed competition, the constraints placed on its behavior and the active, ongoing oversight by the Court and the plaintiffs provide useful protection against a recurrence of such harm. For those who believe that Microsoft should not have been found liable because of insufficient evidence of harm to consumers, the remedies may be unnecessary, but they avoided the serious potential damage to consumer welfare that was likely to accompany the main alternative proposals. The remedies actually imposed appear to have struck a reasonable balance between protecting consumers against the types of actions found illegal and harming consumers by unnecessarily restricting Microsoft's ability to compete.
    JEL: K21 L1 L4 L6
    Date: 2005–10

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