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on Innovation |
| By: | Giovanni Dosi; Luigi Marengo; Corrado Pasquali |
| Abstract: | The paper attempts a critical assessment of both the theory and the empirical evidence on the role of appropriability and in particular of Intellectual Property Right (IPR) as incentives for technological innovation. We start with a critical discussion of the standard justification of the attribution of IPR in terms of "market failures" in knowledge generation. Such an approach we argue misses important features of technological knowledge and also neglects the importance of non-market institutions in the innovation process. Next, we examine the recent changes in the IPR regimes and their influence upon both rates of patenting and underlying rates of innovation. The evidence broadly suggests that, first, IPRs are not the most important device apt to "profit from innovation"; and second, they have at best no impact, or possibly even a negative impact on the underlying rates of innovation. Rather, we argued, technology- and industry-specific patterns of innovation are primarily driven by the opportunities associated with each technological paradigm. Conversely, firm-specific abilities to seize them and "profit from innovation" depend partly on adequacy of the strategic combinations identified by the taxonomy of Teece (1986) and partly on idiosyncratic capabilities embodied in the various firms. |
| Keywords: | Appropriability, Intellectual Property Right, Innovation, Technological opportunities |
| Date: | 2006–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2006/17&r=ino |
| By: | Butter, Frank A.G. den (Vrije Universiteit Amsterdam, Faculteit der Economische Wetenschappen en Econometrie (Free University Amsterdam, Faculty of Economics Sciences, Business Administration and Economitrics); Wit, Paul |
| Abstract: | Commonly increases in total factor productivity (TFP) are associated with technological innovations measured by R&D expenditures. Empirical evidence seems to corroborate this relationship. However, in trading countries like the Netherlands, productivity increases, even in industry, can also be the result of innovations in the way transactions are managed. These innovations reduce transaction costs and exploit the welfare gains from (further) international division of labour. Such innovations are only partly included in R&D data. Consequently there is not much attention for these "trade innovations" - as we label them - in policy. In an empirical analysis this paper compares the influence of trade innovations with the influence of R&D expenditures on TFP in various industrialized countries. It appears that, at least in the Netherlands, trade innovations are as important for TFP as technological innovations which directly affect the efficiency of production, and which we label "product innovations". |
| Keywords: | R&D; Innovation; Transaction costs; Total factor productivity |
| JEL: | F10 F43 O47 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:vuarem:2006-13&r=ino |