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on Innovation |
| By: | Waheed, Abdul (UNU-MERIT) |
| Abstract: | The impact of size and competition on firm-level innovative activities has obtained considerable attention in developed countries, but the focus is still lacking in developing world. This paper is an attempt to contribute in this direction by including 14 Latin American countries, and by using Enterprise Survey data of the World Bank. We consider both input and output innovation to observe the influence of firm size and of market concentration on innovative activities, and to interrogate the differences in influences of innovation determinants in different size classes and competition statuses. Our analysis reveals that employment increases the likelihood of R&D and product innovation, and its influence on R&D expenditures is positive but at less than proportionate rate. We find that product market competition increases the probability of both R&D decision and innovation output, but it has no influence on R&D intensity. We observe no relationship between R&D expenditures per employee and product innovation. Country and industry differences also contribute substantially towards firm-level R&D activities and product innovation. Moreover, large or small firms do no tend to be advantageous for employment and competition in order to influence R&D activities; however, for product innovation, competition is a more significant stimulus for large firms compared to small ones. Our results suggest that firms' R&D productivity is independent of size classes and competition environments. All of the determinants (of innovation) are jointly observed to have different effects, for large and small firms, as explanatory factors of both R&D intensity and product innovation, and for different competition environments only for product innovation. |
| Keywords: | R&D, Product innovation, Firm size, market competition |
| JEL: | L11 L12 L13 O32 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2011052&r=ino |
| By: | Hou, Jun (UNU-MERIT); Mohnen, Pierre (UNU-MERIT, Maastricht University) |
| Abstract: | In order to catch up with the technological frontier, firms, especially in developing countries, try to acquire technological advancement through internal R&D efforts as well as through external technology sourcing activities. This study tests the existence of a complementarity between in-house R&D and external technology acquisition in Chinese manufacturing firms. We show that the two sources of technological upgrading are complementary in stimulating product innovation across small and medium size manufacturing firms in China, but not in generating process innovation nor in achieving higher levels of labor productivity. |
| Keywords: | R&D, technology purchasing, complementarity, China, manufacturing |
| JEL: | O33 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2011048&r=ino |
| By: | Maria Comune (University of Siena and Fondazione Eni Enrico Mattei); Alireza Naghavi (University of Bologna and Fondazione Eni Enrico Mattei); Giovanni Prarolo (University of Bologna and Fondazione Eni Enrico Mattei) |
| Abstract: | With the rise of the knowledge economy, delivering sound innovation policies requires a thorough understanding of how knowledge is produced and diffused. This paper takes a step to analyze a new form of globalization, the so-called system of Global Innovation Networks (GINs), to shed light on how the protection of intellectual property rights (IPRs) influences their creation and development. We focus on the role of IPR protection in fostering international innovative activities in emerging economies (South), such as China and India, and more generally, how IPRs affect the development of GINs between newly industrialized countries and OECD countries. Using both survey-based firm-level and country-level global data, we find IPRs to be an important determinant of participation in GINS from a Southern perspective. We find IPR protection at home and its harmonization across county pairs foster South-North formation of GINs. We also find that a stringent regime in the destination country discourages foreign international innovative activities that originate in NICs. Both levels of our analysis confirm the ICT industry, particularly the hardware segment, to rely on IPRs when engaging in the international outsourcing and offshoring of innovation or in patenting activities abroad. |
| Keywords: | Gravity Model, Information Communication Technology, Innovation, Intellectual Property Rights, International collaborations, Networks |
| JEL: | D23 F53 O34 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2011.59&r=ino |
| By: | Hall, Bronwyn H. (UNU-MERIT, Maastricht University, and UC Berkeley) |
| Abstract: | This paper surveys what we know about the internationalization of business R&D spending. I examine three specific questions about the global changes in R&D activity: First, what is the evidence that R&D is becoming more internationalized (more footloose)? Second, what are the factors that influence the choice of location for R&D? The third question asks how this is changing over time. The paper concludes with a discussion of the implications of this research and the trends in business R&D location for Canada. |
| Keywords: | business R&D, FDI, globalization, Canada |
| JEL: | F23 O32 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2011049&r=ino |
| By: | Hoewer, Daniel; Schmidt, Tobias; Sofka, Wolfgang |
| Abstract: | Information economics has emerged as the primary theoretical lens for framing financing decisions in firm R&D investment. Successful outcomes of R&D projects are either ex-ante impossible to predict or the information is asymmetrically distributed between inventors and investors. As a result, bank lending for firm R&D has been rare. However, firms can signal the value of their R&D activities and as a result reduce the information deficits that block the availability of external funding. In this study we focus on three types of signals: Firm's existing patent stock, the presences of a joint venture investor and whether the firm has received a government R&D subsidy. We argue theoretically that all of these signals have the potential to alter the risk assessment of the firm's main bank. Additionally, we explore heterogeneities in these risk assessments arising from the industry level and the main bank's portfolio. We test our theoretical predictions for a sample of more than 7,000 firm observations in Germany over a multi-year period. Our theoretical predictions are only supported for firms' past patent activity while other signals fail to alter the risk assessment of a firm's main bank. Besides, we confirm that the risk evaluation is not randomly distributed across bank-firm dyads but depends on industry and bank characteristics. -- |
| Keywords: | Innovation,banking,information asymmetry |
| JEL: | D82 G30 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:11055&r=ino |
| By: | Hoewer, Daniel; Schmidt, Tobias; Sofka, Wolfgang |
| Abstract: | Information economics has emerged as the primary theoretical lens for framing financing decisions in firm R&D investment. Successful outcomes of R&D projects are either ex-ante impossible to predict or the information is asymmetrically distributed between inventors and investors. As a result, bank lending for firm R&D has been rare. However, firms can signal the value of their R&D activities and as a result reduce the information deficits that block the availability of external funding. In this study we focus on three types of signals: Firm's existing patent stock, the presences of a joint venture investor and whether the firm has received a government R&D subsidy. We argue theoretically that all of these signals have the potential to alter the risk assessment of the firm's main bank. Additionally, we explore heterogeneities in these risk assessments arising from the industry level and the main bank's portfolio. We test our theoretical predictions for a sample of more than 7,000 firm observations in Germany over a multi-year period. Our theoretical predictions are only supported for firms' past patent activity while other signals fail to alter the risk assessment of a firm's main bank. Besides, we confirm that the risk evaluation is not randomly distributed across bank-firm dyads but depends on industry and bank characteristics. -- |
| Keywords: | Innovation,banking,information asymmetry |
| JEL: | D82 G30 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdp1:201119&r=ino |
| By: | Alireza Naghavi (University of Bologna and Fondazione Eni Enrico Mattei); Chiara Strozzi (University of Modena and Reggio Emilia) |
| Abstract: | In this paper we study theoretically and empirically the role of the interaction between skilled migration and intellectual property rights (IPRs) protection in determining innovation in developing countries (South). We show that although emigration from the South may directly result in the well-known concept of brain drain, it also causes a brain gain effect, the extent of which depends on the level of IPRs protection in the sending country. We argue this to come from a diaspora channel through which the knowledge acquired by emigrants abroad can flow back to the South and enhance the skills of the remaining workers there. By increasing the size of the innovation sector and the skill-intensity of emigration, IPRs protection makes it more likely for diaspora gains to dominate, thus facilitating a potential net brain gain. Our main theoretical insights are then tested empirically using a panel dataset of emerging and developing countries. The findings reveal a positive correlation between emigration and innovation in the presence of strong IPRs protection. |
| Keywords: | Intellectual property rights, Migration, Technology transfer, Brain gain, Diaspora |
| JEL: | O34 F22 O33 J24 J61 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2011.60&r=ino |
| By: | David Mare (Motu Economic and Public Policy Research); Richard Fabling (Reserve Bank of New Zealand); Steven Stillman (Motu Economic and Public Policy Research, IZA and CReAM) |
| Abstract: | We combine firm-level innovation data with area-level Census data to examine the relationship between local workforce characteristics, especially the presence of immigrants and local skills, and the likelihood of innovation by firms. We examine a range of innovation outcomes, and test the relationship for selected subgroups of firms. We find a positive relationship between local workforce characteristics and average innovation outcomes in labour market areas, but this is accounted for by variation in firm characteristics such as firm size, industry, and research and development expenditure. Controlling for these influences, we find no systematic evidence of an independent link between local workforce characteristics and innovation. |
| Keywords: | Innovation; Immigration; Local labour market |
| JEL: | O31 R30 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:1110&r=ino |
| By: | Rasheed, Sulaiman V. (CRISP); Hall, Andy (LINK, Open University and UNU-MERIT); Reddy, T.S. Vamsidhar (Open University) |
| Abstract: | This paper reflects on the experience of the Research Into Use (RIU) projects in Asia. It reconfirms much of what has been known for many years about the way innovation takes place and finds that many of the shortcomings of RIU in Asia were precisely because lessons from previous research on agricultural innovation were "not put into use" in the programme's implementation. However, the experience provides three important lessons for donors and governments to make use of agricultural research: (i) Promoting research into use requires enabling innovation. This goes beyond fostering collaboration, and includes a range of other innovation management tasks (ii) The starting point for making use of research need not necessarily be the promising research products and quite often identifying the promising innovation trajectories is more rewarding (iii) Strengthening the innovation enabling environment of policies and institutions is critical if research use is to lead to long-term and large-scale impacts. It is in respect of this third point that RIU Asia missed its target, as it failed to make explicit efforts to address policy and institutional change, despite its innovation systems rhetoric. This severely restricted its ability to achieve wide-scale social and economic impact that was the original rationale for the programme. |
| Keywords: | Research Into Use, Innovation Management, Agricultural Research, Innovation, Development, Policy, Value Chain Development, South Asia, Innovation Trajectory |
| JEL: | L26 L31 L33 N55 O13 O19 O21 O22 O31 O32 O33 O53 Q13 Q16 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2011050&r=ino |
| By: | Jakub Growiec; Fabio Pammolli; Massimo Riccaboni |
| Abstract: | We provide a detailed analysis of a model of innovation and corporate dynamics that encompasses the Gibrat’s Law of Proportionate Effect and the Simon growth process as particular instances. The predictions of the model are derived in terms of (i) firm size distribution, (ii) the distribution of firm growth rates, and (iii-iv) the relationships between firm size and the mean and variance of firm growth rates. We test the model against data from the worldwide pharmaceutical industry and find its predictions to be in good agreement with empirical evidence on all four dimensions. |
| Keywords: | Business firm size; firm growth distribution; Gibrat's Law; Pareto distribution; lognormal distribution, size-variance relationship. |
| JEL: | C49 L11 L25 L65 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:trt:disawp:2011/8&r=ino |
| By: | Bosi, Stefano; Laurent, Thierry |
| Abstract: | This paper aims at providing a simple economic framework to address the question of the optimal share of investments in medical R&D in total public spending. In order to capture the long-run impact of tax-financed medical R&D on the growth rate, we develop an endogenous growth model in the spirit of Barro [1990]. The model focuses on the optimal sharing of public resources between consumption and (non-health) investment, medical R&D and other health expenditures. It emphasizes the key role played by the public health-related R&D in enhancing economic growth and welfare in the long run. |
| Keywords: | Public health ; Medical R&D; Public spending; Endogenous growth |
| JEL: | H51 I18 H23 O31 |
| Date: | 2011–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33789&r=ino |
| By: | Raoul Minetti; Pierluigi Murro; Monica Paiella (-) |
| Abstract: | - |
| Keywords: | Ownership, Agency problems, Technological change |
| JEL: | G32 O3 |
| Date: | 2011–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:prt:dpaper:1_2011&r=ino |
| By: | Jan Fagerberg (Centre for Technology, Innovation and Culture, University of Oslo); Morten Fosaas (Centre for Technology, Innovation and Culture, University of Oslo); Martin Bell (SPRU – Science and Technology Policy Research, The Freeman Centre, University of Sussex); Ben Martin (SPRU – Science and Technology Policy Research, The Freeman Centre, University of Sussex) |
| Abstract: | This paper focuses on Christopher Freeman’s contributions to the field of innovation studies. First, we consider his role as the creator of various organisational and intellectual frameworks crucial for the field’s development, including the main research activities he initiated. Next, we examine the publications by Freeman that these activities led to. A database of surveys of the innovation literature, assembled from articles in handbooks covering this area, is used to identify the most influential of his writings for this field. In addition, citations to these works in scholarly journals are analysed in order to examine the nature and extent of his influence on other scholars. The final section sums up the evidence regarding Freeman’s influence on the field’s development. A list of Freeman’s scholarly works is included as an appendix. |
| Keywords: | Freeman, innovation studies, SPRU, economics of innovation, innovation systems |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:tik:inowpp:20110926&r=ino |
| By: | Salzberger, Eli (University of Haifa) |
| Abstract: | The term "intellectual property" is a relatively a modern term, first used in its current meaning when the UN established the World Intellectual Property Organization (WIPO) in 1967. Beforehand laws around the world protected various aspects of informational goods - inventions and creations - using separate legal concepts, such as copyright, patents and trademarks, which were not perceived as property rights. This linguistic aspect is by no means anecdotal or marginal as it can be argued that the term "intellectual property" constituted its contemporary meaning including the economic analysis of informational goods and services, as can be demonstrated by the recent call to treat trade secrets not as a contractual agreement but as intellectual property (Epstein, 2005). This paper focuses on the normative analysis of IP rights and criticizes the implicit shift in economic analysis of IP from the incentives paradigm, which is founded upon the public good analysis of neo-classical micro-economic theory, to the new propriety paradigm, which is intellectually founded upon the tragedy of the commons literature. It further criticizes the dominant contemporary Law and Economics writings in this field as pre-assuming information to be an object of property, overlooking its fundamental differences from physical property and thus focusing on its management and maximization of value for its "owners" rather than on its initial justifications and its social value and contribution to innovation, growth and progress. |
| Keywords: | Law; intellectual property; growth; incentives |
| JEL: | K11 O31 O34 O43 |
| Date: | 2011–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0177&r=ino |
| By: | Gerald A. Carlino; Jake K. Carr; Robert M. Hunt; Tony E. Smith |
| Abstract: | The authors study the location and productivity of more than 1,000 research and development (R&D) labs located in the Northeast corridor of the U.S. Using a variety of spatial econometric techniques, they find that these labs are substantially more concentrated in space than the underlying distribution of manufacturing activity. Ripley's K-function tests over a variety of spatial scales reveal that the strongest evidence of concentration occurs at two discrete distances: one at about one-quarter of a mile and another at about 40 miles. These findings are consistent with empirical research that suggests that some spillovers depreciate very rapidly with distance, while others operate at the spatial scale of labor markets. The authors also find that R&D labs in some industries (e.g., chemicals, including drugs) are substantially more spatially concentrated than are R&D labs as a whole.> > Tests using local K-functions reveal several concentrations of R&D labs (Boston, New York-Northern New Jersey, Philadelphia-Wilmington, and Washington, DC) that appear to represent research clusters. The authors verify this conjecture using significance-maximizing techniques (e.g., SATSCAN) that also address econometric issues related to "multiple testing" and spatial autocorrelation.> > The authors develop a new procedure for identifying clusters — the multiscale core-cluster approach — to identify labs that appear to be clustered at a variety of spatial scales. They document that while locations in these clusters are often related to basic infrastructure, such as access to major roads, there is significant variation in the composition of labs across these clusters. Finally, the authors show that R&D labs located in clusters defined by this approach are, all else equal, substantially more productive in terms of the patents or citation-weighted patents they receive.> |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:11-42&r=ino |
| By: | Cocchi, Andrea |
| Abstract: | This paper aims to explore the potential role of Innovation Intermediaries in the evolution of a traditional cluster toward a service-oriented perspective. In particular, we will highlight the generative function of business models, here as market devices, in stimulating the co- evolution of Intermediary and target firms’ strategies. |
| Keywords: | Business Models; Innovation Intermediaries; Entrepreneurship; Manufacturing; Systemic Instruments |
| JEL: | A12 O33 L26 D83 L64 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33766&r=ino |
| By: | Massimiliano Mazzanti; Caterina Cardinali |
| Abstract: | This work aims at analysing the evolution of music industry, since the beginning of music marketed as a product for the masses until the new frontiers of digital music. Our goal is to identify which factors played a key role in the evolution of the demand in the last years and in the largely discussed crisis of the international music market. In order to reach our goal, it is necessary to contextualise the analysis, starting from the definition of the so-called pop music, or popular music, that must not be confused with the expression “musica popolare†that in Italian defines folk traditional music. We analysed diverse sets of data, ranging from economic ones to sociology-related studies, which helped us to understand, through the contribution of several schools of thought, which factors influence music consumption and to what extent demand and supply influence each other. Our work focuses on the conception of the music market as an eclectic sector of cultural industry, halfway between entertainment, leisure and culture. Music can be used in several ways, and during the years the use has been modified by the implementation of new technological means (particularly referring to the phonograph) by the attempt to satisfy needs that change constantly, such as self-accomplishment, social aggregation or escape from the routine. On the basis of these needs the industry periodically tried to control demand through push strategies, trying to impose new musical trends and pull strategies, adapting to the consumption trends registered. It is important to determine to what extent acting on the market influenced the current situation and whether in this context music is the only element to take into account or not. Our idea is that music does not always play a key role in demand dynamics, that is to say music influences consumption to the extent it is able to meet specific requests by the public, that sometimes are not strictly related to the product itself. Because of the uncertainty of the record industry, technology, market situation and demand become extremely interdependent factors. |
| Keywords: | Schumpeterian dynamics; Music industry; Appropriability; Radical innovations |
| JEL: | O3 Z1 |
| Date: | 2011–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:udf:wpaper:201113&r=ino |
| By: | Xavier Cirera (IDS and CARIS, University of Sussex); Anabel Marin (SPRU, University of Sussex and Conicet, Argentina); Ricardo Markwald (FUNCEX, Brazil) |
| Abstract: | A stylised fact of the economic literature suggests that export diversification is good for economic growth and is associated with economic development. In addition, there is evidence suggesting that the level of sophistication of countries’ exports “matters” for growth and development. This paper contributes to this literature by analysing two unexplored dimensions of export diversification: the degree of relatedness (similarity) and sophistication of new products in relation to existing ones. The objective of this paper is to understand the mechanisms through which firms are able to diversify to less related and more sophisticated activities. We do so using a unique dataset that links data on exports, innovation and firms’ characteristics at the firm level in Brazil. The main findings suggest that i) diversification occurs in very closely related activities, where firms have some core competences, ii) most diversification occurs in new products with lower level of sophistication than existing exports, iii) the degree of diversification and innovativeness of the production basket, and the position that the firm has developed in the domestic market appear to matter for diversification towards more or less distant products. |
| Keywords: | Diversification; Relatedness; Sophistication; Trade; Innovation; Brazil |
| JEL: | F14 L25 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:sus:susewp:2611&r=ino |