nep-ino New Economics Papers
on Innovation
Issue of 2009‒11‒27
five papers chosen by
Steffen Lippert
Massey University Department of Commerce

  1. How General Are General Purpose Technologies? Evidence from nano-, bio- and ICT-technologies in Finland By Tuomo Nikulainen; Martti Kulvik
  2. Services outsourcing and innovation: An empirical investigation By Görg, Holger; Hanley, Aoife
  3. Waiting to imitate: on the dynamic pricing of knowledge By Henry, Emeric; Ponce, Carlos
  4. Competing process and quality innovation in a model of occupational choice By Colin Davis; Yasunobu Tomoda
  5. Knowledge Spillovers from Creation to Exploitation: A Theoretical Model with Implications for Firms and Public Policy By Zoltan J. Acs; Claire Economidou; Mark Sanders

  1. By: Tuomo Nikulainen; Martti Kulvik
    Abstract: ABSTRACT : General purpose technologies (GPT) have a significant impact on economic activity through radical technological change and wide technological diffusion. This paper aims to address the generality of technologies associated with the GPT concept. Information and communications technologies (ICT), biotechnology and nanotechnology are viewed as existing or potential general purpose technologies, but there is a lack of empirical evidence of their generality. This paper addresses the argument by using patent, industry and company level data from Finland. The results provide evidence that ICT, as expected, is a GPT. Nanotechnology shows signs of being potentially widely applicable, but for biotechnology the channels of technological diffusion seem to be fewer and more focused on areas where Finnish companies are less active. The results and discussion are also reflected on the newly formed innovation policy instrument in Finland - SHOKs (Strategic centres for science, technology and innovation), which aim to direct a large share of the Finnish public R&D subsidies towards more demand-based and incumbent-driven innovation activity.
    Keywords: general purpose technology, technology diffusion, science-based technology, ICT, biotechnology, nanotechnology, SHOK
    JEL: O30 O33 O38
    Date: 2009–11–20
  2. By: Görg, Holger; Hanley, Aoife
    Abstract: We provide a comprehensive empirical analysis of the links between international services outsourcing, domestic outsourcing, profits and innovation using plant level data. We find a positive effect of international outsourcing of services on innovative activity at the plant level. Such a positive effect can also be observed for domestic outsourcing of services, but the magnitude is smaller. This makes intuitive sense, as international outsourcing allows more scope for exploiting international factor price differentials, therefore giving the establishment higher profits and more scope to restructure production activities towards innovation. We also find that international services outsourcing has a positive effect on profitability, as predicted by theory, while this is not true for domestic sourcing. The results are robust to various specifications and an instrumental variables analysis.
    Keywords: innovation; offshoring; R&D; services outsourcing
    JEL: F19 O31
    Date: 2009–08
  3. By: Henry, Emeric; Ponce, Carlos
    Abstract: We study the problem of an inventor who brings to the market an innovation that can be legally copied. Imitators may 'enter' the market by copying the innovation at a cost or by buying from the inventor the knowledge necessary to reproduce and use the invention. The possibility of contracting affects the need for patent protection. Our results reveal that: (i) Imitators wait to enter the market and the inventor becomes a temporary monopolist; (ii) The inventor offers contracts which allow resale of the knowledge acquired by the imitators; (iii) As the pool of potential imitators grows large, the inventor may become a permanent monopolist.
    Keywords: contracting; knowledge trading; Patents; war of attrition
    JEL: C73 D23 L24 O31 O34
    Date: 2009–10
  4. By: Colin Davis (Kobe University, Graduate School of Economics); Yasunobu Tomoda (Kyoto University, Institute of Economic Research)
    Abstract: We develop a simple model of endogenous growth and occupational choice in which skill differentiated workers choose between three types of employment activity: production, process innovation,and quality innovation. Incumbent firms invest in process innovation to reduce production costs and market entrants invest in quality improvements in order to capture the market from vintage product lines. We use this framework to examine innovation incentives for incumbent firms in an environment of creative destruction and find that there are two plausible and stable patterns of product evolution: a corner equilibrium with quality growth alone, and an interior equilibrium with both productivity growth and quality growth. We also show that the process innovation of an interior equilibrium has important policy implications for economic growth.
    Keywords: Process innovation;Quality innovation; Endogenous growth; Occupational choice
    Date: 2009–11
  5. By: Zoltan J. Acs; Claire Economidou; Mark Sanders
    Abstract: In this paper we present an endogenous growth model in which we investigate the implications of knowledge spillovers between knowledge creators (inventors) and commercializers (innovators). We then turn to the question how such knowledge spillovers affect value creation within and among organizations as well as at the aggregate level and discuss how the internalization of these knowledge spillovers can help improve economic performance at both levels.
    Keywords: knowledge spillovers; innovation management; strategic entrepreneurship
    JEL: L26 O31 O32 O38
    Date: 2009–11

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