nep-ino New Economics Papers
on Innovation
Issue of 2008‒01‒19
ten papers chosen by
Steffen Lippert
Massey University Department of Commerce

  1. How Firm Organizations Adapt to Secure a Sustained Knowledge Transfer By U. Witt; C. Zellner
  2. Moore's Law, Increasing Complexity, and the Limits of Organization: The Modern Significance of Japanese Chipmakers' DRAM Business By CHUMA Hiroyuki; HASHIMOTO Norikazu
  3. Privatization of Knowledge: Did the U.S. Get It Right? By Guido Cozzi; Silvia Galli
  4. Technical Change and Economic Growth: Some Lessons from Secular Patterns and Some Conjectures on the Current Impact of ICT Technology By Carolina Castaldi; Giovanni Dosi
  5. Principles for benchmarking potentially alternative systems of private copy compensation By FRANCISCO MARCOS; JUAN SANTALO
  6. Innovations from SMEs or Large Firms? Sector Structure and Dynamics By Wilfred Dolfsma; Gerben van der Panne
  7. Disentangling the R+D shortfall of the EU vis-a-vis the US By Hugo Erken; Frank van Es
  8. Exploration and Exploitation - The Role of Entrepreneurship and R+D in the Process of Innovation By Max Keilbach; Mark Sanders
  9. The Use of Knowledge Management by Innovators - Empirical Evidence for Germany By Uwe Cantner; Kristin Joel; Tobias Schmidt
  10. Location and R&D alliances in the European ICT industry By Rajneesh Narula; Grazia D. Santangelo

  1. By: U. Witt; C. Zellner
    Abstract: New knowledge with potential commercial value is created, replicated, and transferred in a distributed manner. The highly systemic nature of knowledge production and the need for any knowledge to be individually acquired and expressed in order to produce an effect, jointly constrain the dynamics of knowledge commercialization. This paper analyzes the nature of these constraints from an individualistic perspective, focusing particularly on the often neglected entrepreneurial aspects of the knowledge transfer. It explains how the constraints are overcome by organizational adaptations inside firms so that a sustained knowledge transfer into the commercial sphere of the innovation system can be secured.
    Keywords: Length 18 pages
    JEL: D23 D83 J24 M13 M51 O31 O40
    Date: 2007–12
  2. By: CHUMA Hiroyuki; HASHIMOTO Norikazu
    Abstract: The purpose of this paper is to identify the organizational constraints on science innovations in the midst of the increasing complexity of technology and markets and to search for measures to overcome them. For this purpose, we scrutinize the rise and fall of Japanese chipmakers in their commodity DRAM business during the last three decades, during which time all of them have been deeply wounded. We take up this business case mainly because the Japanese semiconductor industry seems to be a forerunner of various science-based industries facing rapid globalization and could provide instructive examples for them in an age of speed-to-market. We think that the rise and fall of Japanese chipmakers in their commodity DRAM business has been deeply influenced by three kinds of ever-growing complexities: the growing market-complexity triggered by the collapse of commodity DRAM prices in 1996, the growing (manufacturing) system-complexity boosted by the advent of 200mm fabrication plants (fabs) in the early 1990s, and the growing process-complexity in fabrication technologies necessitated by 64Mb commodity DRAMs. We explain how and why, compared with U.S. and Korean competitors, Japanese chipmakers could not respond to these growing complexities in a systematic and well-organized manner.
    Date: 2008–01
  3. By: Guido Cozzi; Silvia Galli
    Abstract: Brilliant ideas are key to economic growth. They often emerge from scienti…c discoveries with no immediate commercial value so rewards may not be aligned to e¤ort. Should basic research be publicly or privately funded? And, to foster innovation and growth, what kinds of discovery should be protected? Post 1980, the US intellectual property institutions facilitated the patentability of basic research. The European and other patenting regimes are slowly changing in the same direction, also encouraged by TRIPs. Did the US choose the better path? We build a Schumpeterian model to re-assess this important turning point.
    Keywords: R&D and Growth, Sequential Innovation, Research Tools, Patent Laws, Kremer Mechanism
    JEL: O31 O34 O41
  4. By: Carolina Castaldi; Giovanni Dosi
    Abstract: This paper discusses the link between patterns of technological change and economic development taking an evolutionary perspective. We argue that the modes and timing of such coupled dynamics are deeply influenced by the emergence of new techno-economic paradigms or regimes. ICT-based technologies are the drivers of the current paradigm, which, we show, is still at an early stage of diffusion, particularly for developing countries. Building from historical evidence, we argue that catching up of developing countries critically depends on their ability to master the technology behind the dominant technoeconomic paradigm. We then discuss threats and opportunities related to a possible ICTbased development path.
    Keywords: Technical change, Economic Growth, ICT
    Date: 2008–01–08
  5. By: FRANCISCO MARCOS (Instituto de Empresa); JUAN SANTALO (Instituto de Empresa)
    Abstract: Current theory provides no clear framework for the analysis of the current system of private copy compensation and its potential modifications and/or alternatives. Building upon more general incentive economics theory and on general legal considerations, this paper attempts to build such analytical framework by proposing a set of principles for benchmarking potentially alternative systems of private copy compensation. The paper also offers a brief analysis of the main modifications and alternatives to the current system in light of the abovementioned principles. The main finding is that, according to the proposed principles, the current system "as is" gets the best appraisal.
    Keywords: Copyright, Economic principles, Intellectual property, Remuneration
    Date: 2007–11
  6. By: Wilfred Dolfsma; Gerben van der Panne
    Abstract: In this paper we investigate which elements in both an industry’s structure and in an industry’s dynamics affect innovativeness. We use the most appropriate measure for innovativeness –new product announcements- to find specifically that dominance of large firms consistently affect industry innovativeness negatively. Other industry structure characteristics are surprisingly consistent across different model specifications. Our findings for indicators of industry dynamics are noteworthy for instance as they contrast with the ILC predication that firm entry will boost innovativeness.
    Keywords: Innovation, small vs large firms, industry structure, industry dynamics, Industry Life Cycle
    JEL: L1 O1 O3
    Date: 2007–12
  7. By: Hugo Erken (Ministry of Economic Affairs and Erasmus University); Frank van Es (CPB Netherlands Bureau for Economics Policy Analysis)
    Abstract: This paper investigates the causes of the shortfall in private R+D expenditure of the EU compared to the US. It shows that differences in the structure of the two economies play only a minor role in explaining the R+D gap. Instead, the European R+D shortfall is mainly caused by a negative intrinsic effect, meaning that companies within European industries spend less on R+D than their US peers in the same sectors. In addition, this negative intrinsic effect is mainly due to institutional differences between the US and the EU15. Government funding of R+D and the internationalization of R+D provide significant explanation as well.
    Keywords: private R+D intensity, internationalization of R+D, economic structure, sector-composition effect, intrinsic effect
    JEL: O32 O38 F23 R39
    Date: 2007–12–20
  8. By: Max Keilbach (Max Planck Institute of Economics, Jena); Mark Sanders (Utrecht School of Economics)
    Abstract: We formulate a model that explicitly separates two functions in the innovation process: The introduction of new goods and the quality improvement of existing goods. While the latter is performed by the corporate R+D sector, the first is performed by entrepreneurs. We show that in a three sector economy, which also includes a producing sector, there exists a stable non trivial allocation of labor to production, innovation and entrepreneurship. We compute the steady state allocation of labor to production, R+D and Entrepreneurship. We show that the innovation rate decreases if one of the innovative sectors does not exist.
    Keywords: Innovation, Variety Expansion, Quality Ladders, Entrepreneurship, R+D Sector.
    JEL: O31 O41
    Date: 2007–12–20
  9. By: Uwe Cantner (Friedrich Schiller Universität Jena); Kristin Joel (Friedrich Schiller Universität Jena); Tobias Schmidt (Deutsche Bundesbank, Economic Research Centre)
    Abstract: In this paper we investigate factors that influence a firm's decision to implement knowledge management practices. Our focus is on knowledge management practices implemented to increase collaboration between actors within a firm on innovation activities. Using information on over 1,500 innovative German firms from the Mannheim Innovationpanel of 2003, we find that an innovation strategy targeted at consumers and continuous R+D activities is positively related to KM usage. In addition, more general firm characteristics like size and the industry of a firm do influence the decision to use knowledge management as well.
    Keywords: knowledge management, innovation, Mannheim Innovation Panel
    JEL: D23 O31 O32
    Date: 2008–01–11
  10. By: Rajneesh Narula (Department of Economics, University of Reading Business School); Grazia D. Santangelo (Facoltà di Scienze Politiche, Università degli Studi di Catania)
    Abstract: This paper shows empirically that in an intra-industry oligopolistic scenario the location of a firm’s innovative activities plays an important role in determining its partner selection in R&D alliances. Such a role is mainly attributed to a strategic use of R&D alliances as a means to limit knowledge flows and protect competences, rather than to promote knowledge flows. By drawing on a novel dataset matching alliances and patent data for the European ICT industry, the econometric analysis shows that partners’ prior co-location (at both national and sub-national regional level), previous ties and technological overlap matter in the choice of partner, while common nationality has a negative impact on alliance formation.
    Keywords: Alliances, R&D location, strategy, co-location, knowledge flows
    JEL: D23 F23 O18 O32 R3
    Date: 2007

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