nep-ino New Economics Papers
on Innovation
Issue of 2011‒09‒22
seven papers chosen by
Steffen Lippert
University of Otago, Dunedin

  1. Firms’ human capital, R&D and innovation: a study on French firms. By Gallié, Emilie-Pauline; Legros, Diego
  2. Making sense of innovation by R&D and non-R&D innovators in low technology contexts: a forgotten lesson for policymakers By José Albors-Garrigos; José L. Hervas-Oliver
  3. Innovation in China: the rise of Chinese inventors in the production of knowledge By Rachel Griffith; Helen Miller
  4. R&D-based Growth in the Post-modern Era By Holger Strulik; Klaus Prettner; Alexia Prskawetz
  5. The Impact of Cultural Diversity on Innovation: Evidence from Dutch Firm-Level Data By Ceren Ozgen
  6. European Cooperative R&D And Firm Performance By Luis Aguiar; Philippe Gagnepain
  7. The role of extensive and intensive margins in explaining corporate R&D growth: Evidence from Spain By Juan Antonio Máñez Castillejo; Dolores Añón Higón; Juan Alberto Sanchis Llopis

  1. By: Gallié, Emilie-Pauline; Legros, Diego
    Abstract: This article investigates the effects of human capital and technological capital on innovation. While the role of technological capital as measured by research and development (R&D) expenditure has been intensively investigated, few studies have been made on the effect of employee training on innovation. This article explores the relationship between innovation and firm employee training. Our methodological approach contributes to the literature in three ways. We propose various indicators of firm employee training. We build a count data panel with a long time-data series to deal with the issue of firms’ heterogeneity. We propose a dynamic analysis. Using dynamic count data models on French industrial firms over the period 1986–1992, we find positive and significant effects of R&D intensity and training on patenting activity. Whatever the indicators of training our results show that the firm employee training has a positive impact on technological innovation.
    Keywords: Patents; R&D; Employee training; Count panel data; Linear feedback model;
    JEL: C23 C25 J24 L60 O31
    Date: 2011
  2. By: José Albors-Garrigos (Dpto. Organización de Empresas); José L. Hervas-Oliver (Dpto. Organización de Empresas)
    Abstract: This paper attempts to use an integrated theory based on a firm’s internal and external sources of knowledge framework to analyze how different are R&D from non-R&D activities to innovate, specially in a context of low and medium low tech (LMT) sectors where most of the firms are SMEs. Simultaneously, the paper also explores the key differences between R&D and non-R&D innovators. The empirical analysis is based on a representative panel of 2023 Spanish manufacturing firms for 2005 and 2006 from the Spanish Ministry of Industry. Innovation in product and process is explained using non-R&D variables such as in Marketing, Design or hiring tertiary degree employees. Only innovation in product is explained by R&D expenditures. Addressing innovation in process, R&D variables work in few cases and neither R&D expenditures but occasionally R&D employees and are specially relevant the non-R&D variables. The interaction (moderating) effect is specially negative and significant, addressing the substitution effect with different implications regarding product or process innovation. Therefore, innovation can be explained using non-R&D variables such as investments in Marketing, Design, and other routines linked to human resources, technology monitoring committees or the existence of a formal plan to innovate. The firms with more internal resources, those which conduct R&D activities present a better AC and it leads to engage in cooperation agreements and access to external flows of knowledge. The paper has important implications for policymakers due to the fact that most of policies for R&D are based on R&D programmes, while there are other realities: non-R&D factors which also explain innovation, specially when considering low tech sector contexts. El presente artículo usa la teoría de recursos y capacidades para, a través de los recursos internos y externos de las empresas, analizar las actividades de R&D y las actividades de no-R&D en su impacto sobre la performance de innovación de la empresa, en un contexto sectorial de baja y media tecnología. Asimismo, el artículo explora el rol innovador de las empresas que hacen R&D y las que no lo hacen. Con una muestra de 2023 empresas manufactureras españolas, obtenemos un comportamiento innovador para la innovación en producto y en proceso y, sobre todo, observando que las actividades de R&D tienen muy poco peso explicativo sobre el resultado de innovación. El artículo presenta implicaciones para la Academia y los policymakers, sobre todo por el hecho de que la mayoría de las políticas de innovación se basan en actividades de R&D.
    Keywords: fuentes de innovación, estrategias de búsqueda de conocimiento externo, cooperación tecnológica, capacidad de absorción. innovation sources, technology cooperation, absorptive capacity, search strategies.
    Date: 2011–07
  3. By: Rachel Griffith (Institute for Fiscal Studies and University of Manchester); Helen Miller (Institute for Fiscal Studies)
    Abstract: <p><p><p>In 2010 China was the world's fourth largest filer of patent applications. This followed a decade of unprecedented increases in investment in skills and Research and Development. If current trends continue China could rank first in the very near future. We provide evidence that the growth in Chinese patenting activity has been accompanied by a growth in Chinese inventors creating technologies that are near to the science base. </p><p></p><p></p><p>Part of the success of China has been to attract the investment of foreign multinationals. This is also true for a number of other Emerging Economies. Europe's largest multinational firms increasingly file patent applications that are based on inventor activities located in emerging economies, often working alongside inventors from the firm's home country. </p></p></p>
    Keywords: China; innovation; offshoring; patents.
    JEL: F21 F23 O3
    Date: 2011–09
  4. By: Holger Strulik; Klaus Prettner (Harvard Center for Population and Development Studies); Alexia Prskawetz (Vienna Institute of Demography)
    Abstract: Conventional R&D-based growth theory suggests that productivity growth is positively correlated with population size or population growth, an implication which is hard to see in the data. Here we integrate R&D-based growth into a unified growth setup with micro-founded fertility and schooling behavior. We then show how a Beckerian child quality-quantity trade-off explains why higher growth of productivity and income per capita are associated with lower population growth. The medium-run prospects for future economic growth - when fertility is going to be below replacement level in virtually all developed countries - are thus much better than predicted by conventional R&D-based growth theory.
    Keywords: R&D, unified growth theory, declining population, fertility, schooling, human capital, post-modern society.
    Date: 2011–08
  5. By: Ceren Ozgen (Department of Spatial Economics, VU University Amsterdam)
    Abstract: Due to the growth in international migration in recent decades, the workforce of firms in host countries has become considerably more diverse, both demographically and culturally. It is an important question for firms and for governments to ask whether there are some productivity-enhancing externalities gained from this growing diversity within firms. In recent years migration research has demonstrated positive economic impacts of cultural diversity on productivity and innovation at the regional level. However, there is a dearth of research on the links between innovation and migrant diversity at the firm level. In this paper we construct and analyse a unique linked employer-employee micro-dataset of 4582 firms, based on survey and administrative data obtained from Statistics Netherlands. Excluding firms in the hospitality industry and other industries that employ low-skilled migrants, we use the local number of restaurants with foreign cuisines and the historical presence of migrant communities as valid instruments of endogenous migrant settlement. We find that firms in which foreigners account for a relatively large share of employment are somewhat less innovative. However, there is strong evidence that firms that employ a more diverse foreign workforce are more innovative, particularly in terms of product innovations.
    Keywords: immigration, innovation, cultural diversity, knowledge spillovers, linked employer-employee data, Netherlands
    JEL: F22 O31
    Date: 2011–09
  6. By: Luis Aguiar (Departamento de Economía - Universidad Carlos III de Madrid); Philippe Gagnepain (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris)
    Abstract: The goal of this paper is to assess the impact on the performance of firms that participate in Research Joint Ventures (RJVs) funded by the Fifth European Framework Programme for Research and Technological Development (EU-FP5). A special emphasis is made on the User-friendly Information Society (IST) programme, one of the most important thematic programmes of the EU-FP5. We use the funding available to the firms as an instrumental variable to account for self-selection and estimate the Local Average Treatment Effect (LATE) of participation by considering labor productivity and profit margin as performance measures. Our results show a large and positive impact of participation on the labor productivity of the firms, whereas the effect on profit margin is weaker. When taking into account the size of the RJV, we find that the positive impact on labor productivity comes mainly from participation in large projects and that participation in smaller RJVs has a negative effect on the profit margin.
    Date: 2011
  7. By: Juan Antonio Máñez Castillejo (Universitat de València); Dolores Añón Higón (Dpto. Estructura Económica); Juan Alberto Sanchis Llopis (Dpto. Estructura Económica)
    Abstract: We analyse the growth of corporate R&D in the Spanish manufacturing sector through its decomposition into the extensive and intensive margins. These margins are decomposed into three distinct components: starting new R&D activities; R&D activities that survive or persist; and deepening existing R&D efforts. The data used is a panel of Spanish manufacturing firms drawn from the Encuesta sobre Estrategias Empresariales, for the period 1990-2006. We show that despite having experienced a substantial increase in R&D, the relative importance of each component differs for small and largefirms. We find that small firms would have had a significant higher R&D growth should they be able to improve their performance with respect to the survival component of the intensive margin. For large firms, deepening appears to be the most important component explaining R&D in the long run. Este trabajo estudia el crecimiento del gasto privado en I+D de las empresas manufactureras españolas a través de su descomposición en dos componentes: el margen extensivo y el margen intensivo. Estos márgenes se descomponen en 3 sub-componentes: iniciarse en la realización de nuevas actividades de I+D; supervivencia o persistencia en la realización de actividades de I+D; e, intensificación de las actividades de I+D ya existentes. Los datos que utilizamos en este trabajo han sido extraídos de laEncuesta sobre Estrategias Empresariales, para el periodo 1990-2006. Nuestros resultados indican que a pesar de que las empresas manufactureras españolas han experimentado un importante aumento en el gasto en I+D, la importancia relativa de cada componente es distinta para las empresas pequeñas respecto de las empresas grandes. Así, las empresas pequeñas hubieran experimentado un mayor aumento en el crecimiento del gasto en I+D si hubieran sido capaces de mejorar el componente depersistencia en la realización de actividades de I+D, dentro del margen intensivo. Para las empresas grandes, la intensificación en la realización de actividades de I+D constituye el principal componente a la hora de explicar la evolución de largo plazo del gasto en I+D.
    Keywords: I+D; Margen extensivo; Margen intensivo. R&D; Extensive margins; Intensive margin.
    JEL: O3
    Date: 2011–07

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