nep-ino New Economics Papers
on Innovation
Issue of 2013‒01‒12
ten papers chosen by
Steffen Lippert
University of Otago, Dunedin

  1. Mainstreaming Innovation in Europe. Findings on Employee Innovation and Workplace Learning from Belgium By De Spiegelaere, Stan; Van Gyes , Guy; Van Hootegem, Geert
  2. Welfare effects of patent protection and productive public services: why do developing countries prefer weaker patent protection? By Tatsuro Iwaisako
  3. The hold-up problem, innovations, and limited liability By Schmitz, Patrick W.
  4. Cross-Border M&A and Innovative Activity: Firm-Level Evidence By Stiebale, Joel
  5. Determining disruptive innovation potential of multi-sided platforms: case of digital books By Muravskii, D. V.; Yablonsky, S. A.
  6. Technological Innovation: Winners and Losers By Leonid Kogan; Dimitris Papanikolaou; Noah Stoffman
  7. Innovation and Education: Is there a 'Nerd Effect'? By Goldbach, Stefan
  8. Growth and welfare effects of health care in knowledge based economies By Kuhn, Michael; Prettner, Klaus
  9. Technological Capabilities of Chinese Enterprises: Who is Going to Compete Abroad? By Böing, Philipp; Müller, Elisabeth
  10. A Dynamic North-South Model of Demand-Induced Product Cycles By Föllmi, Reto; Hanslin, Sandra; Kohler, Andreas

  1. By: De Spiegelaere, Stan; Van Gyes , Guy; Van Hootegem, Geert
    Abstract: The EU is striving for an ‘Innovative Union’. Various case studies already hinted that the involvement of various types of employees is crucial for the organisational innovativeness. Using data from a large scale Belgian employee level survey in five industries, this article focuses on the question how ‘mainstream’ innovation is in Belgian firms and how this coincides with forms of workplace learning. Innovation mainstreaming here refers to the inclusion of various occupational groups in the innovation process. Findings suggest that innovation in most sectors, is an ‘elite driven’ process with only a limited involvement of lower level employees. Moreover, genuine employee-driven innovations are a rarity. Nevertheless, the research also finds that workplace learning (job training and in-work learning opportunities) are potentially strong levers for employee innovation for all types of employees. Specifically providing in-work learning opportunities to technical workers could make innovation more mainstream in Europe.
    Keywords: Employee Driven Innovation; Innovation Mainstreaming; Innovative Work Behaviour; Workplace Learning
    JEL: D23 D83 D8 O31
    Date: 2012–12
  2. By: Tatsuro Iwaisako (Graduate School of Economics, Osaka University)
    Abstract: This paper examines the welfare-maximizing degree of patent protection in a growth model where the engines of economic growth are R&D and public services. We find that an increase in public services enhances the positive and negative effects of strengthening patent protection on R&D and the volume of production, respectively. However, if public services are relatively small, the negative welfare effect associated with the decrease in production volume tends to outweigh the positive welfare effect from the increase in the growth rate, and so the welfare-maximizing degree of patent protection tends to be lower. This result provides one possible explanation for why developing countries tend to prefer weaker patent protection.
    Keywords: endogenous growth, patent protection, public services, welfare analysis
    JEL: O34 O38 O40
    Date: 2012–12
  3. By: Schmitz, Patrick W.
    Abstract: An inventor can invest research effort to come up with an innovation. Once an innovation is made, a contract is negotiated and unobservable effort must be exerted to develop a product. In the absence of liability constraints, the inventor's investment incentives are increasing in his bargaining power. Yet, given limited liability, overinvestments may occur and the inventor's investment incentives may be decreasing in his bargaining power.
    Keywords: hold-up problem; incomplete contracts; research and development; limited liability
    JEL: D86 L23 O31
    Date: 2012–12
  4. By: Stiebale, Joel
    Abstract: This paper provides empirical evidence on the relationship between cross-border mergers and acquisitions (M&A) and innovation. For the empirical analysis a unique firm-level data set is constructed that combines balance sheet data and an M&A database with information on patent applications. Within three years after a cross-border M&A, patent applications filed by the merged entity increase by more than 30%. Splitting patent applications by the inventors country it is found that the positive association with post-merger patenting is mainly driven by patents invented in the countries of the acquirers headquarter and its previous subsidiaries. In contrast, there is on average a decrease in patent applications invented in the targets country of more than 60%. Accounting for endogeneity of international acquisitions by estimating dynamic count data models and applying instrumental variable techniques, the results indicate that part of this correlation stems from a causal effect. --
    JEL: D22 F23 G34
    Date: 2012
  5. By: Muravskii, D. V.; Yablonsky, S. A.
    Abstract: In this work, disruptive innovation theory is applied to studying multi-sided platforms (MSPs). It is argued that a successful MSP is one that is capable of making products, which are likely to disrupt the current market. The authors develop a mechanism by which it is possible to determine the disruptive potential of an innovation. Its application is then demonstrated on the case of E-publishing and digital books. Based on the study, we suggest that determining disruptive potential should be a key strategic question, when creating and managing MSPs.
    Keywords: Multi-sided platforms, Disruptive innovations, Innovation potential, E-publishing, Digital books,
    Date: 2012
  6. By: Leonid Kogan; Dimitris Papanikolaou; Noah Stoffman
    Abstract: We analyze the effect of innovation on asset prices in a tractable, general equilibrium framework with heterogeneous households and firms. Innovation has a heterogenous impact on households and firms. Technological improvements embodied in new capital benefit workers, while displacing existing firms and their shareholders. This displacement process is uneven: newer generations of shareholders benefit at the expense of existing cohorts; and firms well positioned to take advantage of these opportunities benefit at the expense of firms unable to do so. Under standard preference parameters, the risk premium associated with innovation is negative. Our model delivers several stylized facts about asset returns, consumption and labor income. We derive and test new predictions of our framework using a direct measure of innovation. The model's predictions are supported by the data.
    JEL: E20 E32 G10 G12
    Date: 2013–01
  7. By: Goldbach, Stefan
    Abstract: Policy makers are interested in fostering economic growth and employment. Therefore, it is important to know how to boost innovation in an effective way. This paper investigates whether entrepreneurs with technical education are more innovative in high-tech industries than economists. The main contribution to the literature is in using the type of education as main explanatory variable for innovation. To analyze this question, the KfW/ZEW Start-Up Panel between 2005 and 2007 is used. Two independent OLS regressions are conducted for entrepreneurs with university degree and practical education. The results suggest that education matters for individuals with a university degree in high-tech industries but not for people with practical education. Having an economics degree is correlated with higher innovativeness. Therefore, for the underlying sample we do not find a nerd effect . --
    JEL: A20 L26 I21
    Date: 2012
  8. By: Kuhn, Michael; Prettner, Klaus
    Abstract: We study the effects of a labor-intensive health care sector within an R&D-driven growth model with overlapping generations. Health care increases longevity and labor participation/productivity. We examine under which conditions expanding health care enhances growth and welfare. Even if the provision of health care diverts labor from productive activities, it may still fuel R&D and economic growth if the additional wealth that comes with expanding longevity translates into a more capital/machine- intensive final goods production and, thereby, raises the return to developing new machines. We establish mild conditions under which an expansion of health care beyond the growth-maximizing level is Pareto-improving. --
    Keywords: endogenous growth,mortality,(Blanchard) overlapping generations,health care,research and development,sectoral composition
    JEL: I15 I18 O11 O41 O43
    Date: 2012
  9. By: Böing, Philipp; Müller, Elisabeth
    Abstract: The objective of this study is to investigate the relation between increasing Chinese high-tech exports and the technological capabilities of Chinese companies. China s recent innovation policy provides substantial incentives for companies to pursue technological upgrading and internationalization strategies. For our analysis, we extend models of New New Trade Theory to include the aspect of the technological capabilities of companies. We use the share of international patent applications as a proxy for exports and find that companies with higher total factor productivity and more valuable technology, as measured with citations received, are more likely to go international. Considering the implications of transport cost, we find that companies located in China s coastal region are more likely to export. We do not find evidence that the inclination to export is dominated by policy considerations. --
    JEL: F23 O34 O31
    Date: 2012
  10. By: Föllmi, Reto; Hanslin, Sandra; Kohler, Andreas
    Abstract: This paper presents a dynamic North-South general equilibrium model with non- homothetic preferences. Innovation takes place in the rich North while firms in the poor South at random imitate products manufactured in the North. The model is able to generate endogenous product cycles as described by Vernon (1966) where the different stages of the product cycle are not only determined by supply side factors but also by the distribution of income between North and South. We simulate comparative statics results of changes in Southern labor productivity, changes in inequality across regions, and changes in the savings rate. We further provide suggestive evidence for the product cycle stages. --
    JEL: O31 F10 O14
    Date: 2012

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