nep-ino New Economics Papers
on Innovation
Issue of 2008‒10‒07
nine papers chosen by
Steffen Lippert
Massey University Department of Commerce

  1. Outsourcing, Complementary Innovations and Growth By Alireza Naghavi; Gianmarco I.P. Ottaviano
  2. Optimal Two-Part Tariff Licensing Contracts with Differentiated Goods and Endogenous R&D By Ramón Faulí-Oller; Joel Sandonís
  3. An exploration of local R&D spillovers in France By Jacques MAIRESSE (CREST-ENSAE, UNU-MERIT & NBER); Benoît MULKAY (LEREPS-GRES)
  4. Direction and intensity of technical change: a micro-founded growth model By zamparelli, luca
  5. Industrial districts, innovation and I-district effect: territory or industrial specialization? By Rafael Boix Domenech
  6. Measuring the Rate of Obsolescence of Patents in Japanese Manufacturing Firms By Nakanishi, Yasuo; Yamada, Setsuo
  7. The Extension of Clusters: Differences-in-Difference Evidence from the Bavarian State-Wide Cluster Policy By Oliver Falck; Stephan Heblich; Stefan Kipar
  8. Irreversible R&D investment with inter-firm spillovers By Gianluca Femminis; Gianmaria Martini
  9. Value Creation in the Interface of Industry and Academy - A Case Study of Intellectual Capital of Technology Transfer Offices At US Universities By Antti-Jussi Tahvanainen; Raine Hermans

  1. By: Alireza Naghavi; Gianmarco I.P. Ottaviano
    Abstract: This paper studies the parallel creation of complementary upstream and downstream innovations by independent labs to shed light on the impact of outsourcing on R&D when supply contracts are incomplete. In particular, we argue that outsourced upstream production contributes to the emergence of innovation networks by creating a demand for upstream R&D. We then analyze under which conditions this leads to faster innovation than in the case of vertically integrated production relying on integrated R&D. In the presence of incomplete supply contracts, the ex-post bargaining power of upstream and downstream parties feeds back to innovation. This determines whether outsourcing decisions leading to static gains from specialized production generate or not also dynamic gains in terms of faster innovation.
    Keywords: outsourcing, complementary innovations, incomplete contracts, organization of firms
    JEL: L14 L23 O32 D91
    Date: 2008–05
  2. By: Ramón Faulí-Oller (Universidad de Alicante); Joel Sandonís (Universidad de Alicante)
    Abstract: In this paper we get the optimal two-part tariff contract for the licensing of a cost reducing innovation to a differentiated goods industry of a general size. We analyze the cases where the patentee is an independent laboratory or an incumbent firm. We show that, regardless of the number of firms, the degree of product differentiation and the type of patentee, the innovation is licensed to all firms. Moreover, we endogenize R&D investment and get that an internal patentee invests more (less) in R&D when the technological opportunity is low (high). In this paper we get the optimal two-part tariff contract for the licensing of a cost reducing innovation to a differentiated goods industry of a general size. We analyze the cases where the patentee is an independent laboratory or an incumbent firm. We show that, regardless of the number of firms, the degree of product differentiation and the type of patentee, the innovation is licensed to all firms. Moreover, we endogenize R&D investment and get that an internal patentee invests more (less) in R&D when the technological opportunity is low (high).
    Keywords: patent licensing, two-part tariff contracts, R&D, product differentiation.
    JEL: L11 L13 L14
    Date: 2008–07
    Abstract: This paper is an attempt to assess the existence and magnitude of local research spillovers in France. We rely on the model of an extended production function (Cobb-Douglas and Translog) with both local and neighborhood R&D capital stocks. We estimate this model on 312 employment areas as of 1999, first for the whole economy, then separately for five large manufacturing industries. We find estimates of R&D capital elasticities with respect to productivity which are significant and plausible both within own-area and across neighboring areas, as well as within own-industry but not across different industries.
    Keywords: Productivity, R&D, Local R&D Spillovers, Spatial Econometrics
    JEL: O30 O32 O47 C21
    Date: 2008
  4. By: zamparelli, luca
    Abstract: This paper develops a growth model combining elements of endogenous growth and induced innovation literatures. In a standard induced innovation model firms select at no cost innovations from an innovation possibilities frontier describing the trade-off between increasing capital or labor productivity. The model proposed allows firms to choose not only the direction but also the size of innovation by representing the innovation possibilities through a cost function of capital and labor augmenting innovations. By so doing, it provides a micro-foundation both of the intensity and of the direction of technical change. The policy analysis implies that an increase in subsidies to R&D as opposed to capital accumulation raises per capita steady state growth, employment rate and wage share.
    Keywords: Induced innovation; endogenous growth; direction of technical change
    JEL: O33 O31 O40
    Date: 2008–02
  5. By: Rafael Boix Domenech (Departament d'Economia Aplicada, Universitat Autonoma de)
    Abstract: The I-district effect hypothesis establishes the existence of highly intense innovation in Marshallian industrial districts due to the presence of external localization economies. However, industrial districts are characterized by specific manufacturing specializations in such a way that this effect could be due to these dominant specializations. The objective of this research is to test whether the effect is explained by the conditions of the territory or by the industrial specialization and to provide additional evidence of the existence and causes of the highly intense innovation in industrial districts (I-district effect). The estimates for Spain of a fixed effects model interacting territory and industry suggest that the high innovative performance of industrial districts is maintained across sectors whereas the industrial specialization behaves differently depending on the type of local production system in which it is placed. The I-district effect is related to the conditions of the territory more than to the industrial specialization. The territory is a key variable in explaining the processes of innovation and should be considered a basic dimension in the design of innovation and industrial policies.
    Keywords: industrial districts, innovation, external economies, district effect
    JEL: O14 O31 R12
    Date: 2008–06
  6. By: Nakanishi, Yasuo; Yamada, Setsuo
    Abstract: This article assesses the rate of obsolescence of patents with measurements of the rate in Japan. Our study departs from Parkes and Schankerman (1989) and Schankerman (1998) because of its application of the ordered probit model. The application of this model enables us to consider the case of noncontinuous renewal fees. The estimated value of the rate of obsolescence in Chemicals is apparently large. Values of obsolescence rate in each industry except Chemicals are located above 24%. The obsolescence rate obtained by our estimates is apparently higher than in previous studies.
    Keywords: Obsolescence rate; Patent; Innovation; Ordered probit model
    JEL: O31
    Date: 2008–06
  7. By: Oliver Falck (Ifo Institute for Economic Research); Stephan Heblich (Max Planck Institute of Economics); Stefan Kipar (Ifo Institute for Economic Research)
    Abstract: If one cluster increases local competitiveness, can politicians, by interlinking clusters, achieve an even better effect at the state level? To answer this question, the paper analyzes the "Cluster Initiative" introduced in 1999 by the Bavarian State Government. The purpose of the initiative was to create a Bavarian-wide innovation network in support of state-wide knowledge flows. Using a difference- in-differences approach, we find that introducing the Bavarian-wide cluster policy increased the likelihood of innovation by a firm in the targeted industry by 4 to 7 percentage points. However, this effect is mainly driven by large firms' increased likelihood to innovate.
    Keywords: Difference-in Difference, Cluster Policy, Regional Policy
    JEL: R38 R11 O32
    Date: 2008–09–25
  8. By: Gianluca Femminis (DISCE, Università Cattolica); Gianmaria Martini (Università di Bergamo)
    Abstract: In our duopoly, an irreversible investment incorporates a significant amount of R&D, so that the improvement it introduces in production processes generates a spillover lowering the second comer's investment cost. The presence of the inter-firm spillover substantially affects the equilibrium of the dynamic game: for low -- and hence realistic -- spillover values, the leader delays her investment until the stochastic fundamental has reached a level such that the follower's optimal strategy is to invest as soon as he attains the spillover. This bears several interesting implications. First, because the follower invests upon benefiting from the spillover, in our equilibrium the average time delay between the two investments is short, which is realistic. Second, we show that in case of a major innovation, an optimal public policy requires a substantial intervention in favour of the investment activity; moreover, an increase in uncertainty -- delaying the equilibrium -- calls for higher subsidization rates. Third, we find, by means of numerical simulations, that the spillover reduces the difference in the leader's and in the follower's maximum value function. Accordingly, our model can help generating realistic market betas.
    Keywords: irreversible investment, knowledge spillover, dynamic oligopoly
    JEL: C73 L13 O33
    Date: 2008–09
  9. By: Antti-Jussi Tahvanainen; Raine Hermans
    Abstract: ABSTRACT : This study scrutinizes the impact of value-creating practices in university-industry technology transfer that facilitate the diffusion of knowledge generated in academic research towards its successful application by companies on markets. To be more precise, the aim is to demarcate the role that US university technology transfer offices (TTOs), one of the consequential arrangements conjured into existence by the Bayh-Dole Act of 1980, play in matching the substance of academic research and the need-driven demand of commercial markets. In the process, they implicitly, yet strategically, guarantee the sustainability of the flow of technologies out of the laboratories towards market application, as their actions and motives uphold and sustain the incentive structures of both of the universes, the academic and the commercial. This is accomplished by performing and specializing in the very functions that neither universe has been able or willing to perform in order to take a step closer towards each other. These contributions are often hard to capture in quantitative measures, which has led to common criticism about the effectiveness of TTOs. We propose such measures to be used with care in the comparative evaluation of TTO performance, but also point at and recognize their value as parameters that can be utilized to internally monitor the performance of each TTO individually over time as a tool of management. Some alternative, Intellectual Capital based measures are suggested.
    Keywords: university technology transfer, technology transfer office, intellectual capital, knowledge management, Bayh-Dole Act, government intervention, value adding functions, value platform
    Date: 2008–09–22

This nep-ino issue is ©2008 by Steffen Lippert. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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