nep-ino New Economics Papers
on Innovation
Issue of 2013‒04‒13
thirty papers chosen by
Steffen Lippert
University of Otago, Dunedin

  1. The Division of Policy Research and Analysis at the National Science Foundation: Its Support of Research on the Returns to R&D By Hall, Michael J.; Layson, Stephen K.; Link, Albert N.
  2. Corporate taxation and the quality of research and development By Ernst, Christof; Richter, Katharina; Riedel, Nadine
  3. Macro-Institutional Instability and the Incentive to Innovate By Masino, Serena
  4. Towards an Efficient Use of R&D – Accounting for Heterogeneity in the OECD By Cullmann, Astrid; Zloczysti, Petra
  5. Understanding Innovation in Production Networks in East Asia By Ganeshan Wignaraja
  6. A Tale of Two Standards: Patent Pools and Innovation in the Optical Disk Drive Industry By Kenneth Flamm
  7. The Economic Value of Patent Portfolios By Gambardella, Alfonso; Harhoff, Dietmar; Verspagen, Bart
  8. Proof of Concept Centers in the United States: An Exploratory Look By Bradley, Samantha R.; Hayter, Christopher S.; Link, Albert N.
  9. Knowledge cumulability and complementarity in the knowledge generation function By Antonelli Cristiano; Colombelli Alessandra
  10. Demand pull and technological flows within innovation systems: the intra-European evidence By Antonelli Cristiano; Gehringer Agnieszka
  11. Optimal growth policy: The role of skill heterogeneity By Grossmann, Volker; Steger, Thomas M.
  12. Trademark or patent? The effects of market structure, customer type and venture capital financing on start-ups' IP decisions By De Vries, G.A.; Pennings, H.P.G.; Block, J.H.
  13. Rational parasites By Benoit, Jean-Pierre; Galbiati, Roberto; Henry, Emeric
  14. Skill Structure and Technology Structure: Innovation and Growth Implications By Pedro Mazeda Gil; Oscar Afonso; Paulo Brito
  15. Competition and Growth: Reinterpreting their Relationship By Daria Onori
  16. Innovation, espaces de co‐working et tiers-lieux : entre conformisme et créativité By Raphaël Suire
  17. International spillovers in a world of technology clubs By Roman Stöllinger
  18. Does Banning Side Payments in Patent Settlements Suffice to Fully Protect Consumers? By Ottoz Elisabetta; Cugno Franco
  19. Sorting out the impact of cultural diversity on innovative firms. An empirical analysis of Dutch micro-data By Ceren Ozgen; Thomas de Graff
  20. Are Academic Spin-Offs necessarily New Technology-Based firms? By Dina Cunha; Sandra T. Silva; Aurora A.C. Teixeira
  21. Industry Dynamics and Aggregate Stability over Transition By Pedro Mazeda Gil; Oscar Afonso; Paulo B. Vasconcelos
  22. Knowledge spillovers and economic performance of firms located in depressed areas: does geographical proximity matter? By Liliana Araújo; Sandra T. Silva; Aurora A.C. Teixeira
  23. Gravity Modeling: International Trade and Innovations By Josheski, Dushko; Fotov, Risto
  24. The effect of patent litigation on firm performance: Evidence for Germany By Schliessler, Paula
  25. The economics of technological congruence By Antonelli Cristiano
  26. Productivity Growth and Convergence: Portugal in the EU 1986-2009 By Adelaide Duarte; Marta Simões; João Sousa Andrade
  27. Endogenous Risk and Growth By Jesse Perla; Christopher Tonetti
  28. Boosting Productivity in Australia By Vassiliki Koutsogeorgopoulou; Omar Barbiero
  29. Different Rules of Legal-Cost Allocation and Patent Hold-Up By Ottoz Elisabetta; Cugno Franco
  30. Intermediate input markets, ICT and innovation in Germany: A firm level analysis By Cerquera, Daniel; Klein, Gordon J.

  1. By: Hall, Michael J. (University of North Carolina at Greensboro, Department of Economics); Layson, Stephen K. (University of North Carolina at Greensboro, Department of Economics); Link, Albert N. (University of North Carolina at Greensboro, Department of Economics)
    Abstract: The U.S. National Science Foundation’s (NSF’s) Division of Policy Research and Analysis (PRA) supported academic research related to, among many other things, measurement of the returns to private and public R&D, during the early 1980s. The findings from this body of research became a foundation for a number of technology and innovation policies promulgated in the aftermath of the U.S. productivity slowdown in the 1970s, and, as we suggest in this paper, a foundation for many contemporary technology and innovation policy initiatives. We argue that there are lessons to be learned from PRA’s successes from its sponsorship of research in this area, and we suggest one possible area of future emphasis for NSF’s on-going Science of Science and Innovation Policy (SciSIP) program.
    Keywords: Division of Policy Research and Analysis; National Science Foundation; Returns to R&D; Technology; Innovation; Science of Science and Innovation Policy
    JEL: O31 O32 O38
    Date: 2013–04–05
  2. By: Ernst, Christof; Richter, Katharina; Riedel, Nadine
    Abstract: This paper examines the impact of tax incentives on corporate research and development (R&D) activity. Traditionally, R&D tax incentives have been provided in the form of special tax allowances and tax credits. In recent years, several countries moreover reduced their income tax rates on R&D output (patent boxes). Previous papers have shown that all three tax instruments are effective in raising the quantity of R&D related activity. We provide evidence that, beyond this quantity effect, corporate taxation also distorts the quality of R&D projects, i.e. their innovativeness and revenue potential. Using rich data on corporate patent applications to the European patent office, we find that a low tax rate on patent income is instrumental in attracting innovative projects with a high earnings potential and innovation level. The effect is statistically signficant and economically relevant and prevails in a number of sensitivity checks. R&D tax credits and tax allowances are in turn not found to exert a statistically significant impact on project quality. --
    Keywords: corporate taxation,patent quality,micro data
    JEL: H3 H7 J5
    Date: 2013
  3. By: Masino, Serena
    Abstract: This paper investigates the channels through which macroeconomic and institutional instability prevents or hinders innovative investment undertakings financed by the domestic private sector. The analysis is based on a sample of 44 countries representing all levels of development and considers a number of instability dimensions. The results suggest a negative impact of real, monetary and political instability on the aggregate level of national R&D financed by the business sector. Thus, they highlight the desirability of stable macro-institutional environments in preventing avoidance or abandonment of private innovation undertakings.
    Keywords: Macroeconomic Volatility, Political Instability, R&D Investment, Innovation
    JEL: O11 O33 O31 C33
    Date: 2013–03–17
  4. By: Cullmann, Astrid; Zloczysti, Petra
    Abstract: Expenditures devoted to research and development (R&D) are scarce and thus need to be used as efficiently as possible given the financial constraints countries are facing. This paper assesses the relative efficiency of R&D expenditures for 26 OECD member countries and 2 non-member countries. As countries differ in their national innovation systems and states of economic development and industrialization, e.g. transition economies in Eastern Europe vs. Asian countries vs. Anglo-Saxon countries, the measurement of R&D efficiency needs to consider differences in the technology of knowledge production. The existing empirical literature on R&D efficiency mainly builds on a homogeneous technology frontier neglecting the importance to account for country-specific heterogeneity. This paper models technological differences in knowledge production among countries using a stochastic frontier model for panel data. Applying a latent class model for SFA, we find empirical evidence for two technological classes, a `capital-intensive' and a `labor-intensive' one. Assuming a common knowledge production technology, as has been done so far in the empirical literature, thus results in biased efficiency estimates.
    Keywords: innovation; knowledge production function; latent classes; R&D efficiency; stochastic frontier analysis
    JEL: C40 O31 O57
    Date: 2013–02
  5. By: Ganeshan Wignaraja (Asian Development Bank Institute (ADBI))
    Abstract: This paper explores the “black box†of innovation in the electronics production network in East Asia through a mapping exercise of technological capabilities and an econometric analysis of exporting in the People’s Republic of China (PRC), Thailand, and the Philippines. Technology-based approaches to trade offer a plausible explanation for firm-level exporting behavior and complement the literature on production networks. The econometric results confirm the importance of foreign ownership and innovation in increasing the probability of exporting in electronics. Higher levels of skills, managers’ education, and capital also matter in the PRC as well as accumulated experience in Thailand. Furthermore, a technology index composed of technical functions performed by firms (to represent technological capabilities) emerges as a more robust indicator of innovation than the research and development (R&D) to sales ratio. Accordingly, technological effort in electronics in these countries mostly focuses on assimilating and using imported technologies rather than formal R&D by specialized engineers.
    Keywords: innovation, Production Networks, East Asia, technology index, Technological Capability, Foreign Ownership, Thailand, PRC, Philippines
    JEL: F23 O31 O32 L63 O57
    Date: 2013–03
  6. By: Kenneth Flamm
    Abstract: The impact of patent pools on the rate and direction of technological change is an open question in both theoretical and empirical studies. Economic theory makes no unequivocal prediction. By contrast, empirical studies of patent pools, to date, have largely concluded that patent pools have been associated with reduced rates of technical innovation in the industries studied. This study differs from previous empirical studies of patent pools by focusing primarily on direct measures of innovation in product markets, rather than on indirect correlates of innovation (like patents), and by exploiting variation over time in how pools were organized in the same technology area. The paper analyzes the economic history of two successive sets of patent pools organized in substantially the same technological area -- the use of optical discs in data storage peripherals connected to computer systems. These two patent pool episodes differed significantly in their organizational and institutional details. These differences appear to have coincided with very different effects on the structure of product markets, and the rate of technical innovation in optical disc products. The analysis concludes that different approaches to pool organization and licensing policies implemented in these two patent pool examples were associated with very different outcomes. The clear implication is that organizational details matter: no single conclusion is likely to fit all cases. As theory seems to predict, the empirical effects of patent pools on innovation are likely to be ambiguous, dependent on the historical and institutional particulars of the pool and the industry it affects.
    JEL: O3 O31 O33 O34
    Date: 2013–03
  7. By: Gambardella, Alfonso; Harhoff, Dietmar; Verspagen, Bart
    Abstract: Patent holders may choose to protect innovations with single patents or to develop portfolios of multiple, related inventions. We propose a simple decision-making model in which patent-holders may allocate resources to either expanding the number of related patents or investing in higher value of patents in the portfolio. We estimate the derived value equation using portfolio value data from an inventor survey. We find that investments in individual inventions exhibit diminishing returns, and that much of the value of a portfolio depends on adding new inventions. These effects are less pronounced in high-techology industries, when the inventions rely on external information, and when the inventor holds a doctorate. We also find higher returns to an increase of the number of inventions when firms perceive patent protection to be strong. Thus, a higher number of inventions in a portfolio may reflect both genuine creation of value or stronger appropriability via patents.
    Keywords: intellectual property rights; inventors; patents; technical change
    JEL: L20 O31 O33 O34
    Date: 2013–01
  8. By: Bradley, Samantha R. (University of North Carolina at Greensboro, Department of Economics); Hayter, Christopher S. (New York Academy of Sciences); Link, Albert N. (University of North Carolina at Greensboro, Department of Economics)
    Abstract: In this paper we identify the population of 32 U.S. university-related Proof of Concept Centers (PoCCs), and we present a model of technology development that identifies the economic role of PoCCs within that model. We examine the broad technology transfer challenges that PoCCs have been established to address. Further, we argue that PoCCs are a growing technology infrastructure in the United States, and they are important as a possible element of our national innovation system.
    Keywords: Proof of Concept Center; University technology transfer; Entrepreneurship; Innovation
    JEL: O31 O34 O38
    Date: 2013–03–28
  9. By: Antonelli Cristiano; Colombelli Alessandra (University of Turin)
    Abstract: This paper explores the role of external knowledge and internal stocks of knowledge in the generation of new technological knowledge. It relies on the notion of recombination and brings together three concepts: the appreciation of current expenses in R&D activities; the analysis of the role of the stock of knowledge composition; the identification of the role of external knowledge available in the regional proximity. The empirical section is based upon a panel of companies listed on the main European financial markets for the period 1995–2006. The econometric analysis considers patents as a measure of the knowledge out put and, on the right hand side, next to R&D expenditures, the stock of knowledge internal and external to each firm. The results confirm that the stock of internal knowledge and the access to external knowledge play a key role in assessing the actual capability of each firm to generate new knowledge.
    Date: 2013–02
  10. By: Antonelli Cristiano; Gehringer Agnieszka (University of Turin)
    Abstract: We investigate the demand pull effects on sector-level total factor productivity growth. Such effects stem from the knowledge interactions carried by the market transactions of intermediate inputs between competent customers and innovative suppliers. Both knowledge interactions and transactions are substantial Ingredients in making the competent demand operate the positive impact on productivity growth of the entire economic system. The demand pull hypothesis is, thus, rejuvenated through the focus on the inter-sectoral linkages between competent users and innovative producers. In the empirical analysis bas ed on a dynamic panel technique, we implement intermediate flows from input-output tables, qualified by productivity increases downstream, in order to investigate their joint influence on the upstream growth of productivity. The evidence Union of the derived demand-driven influence regarding the European (EU) over the period 1995-2007 is strong and positive, but varies between three EU innovation systems, EU core, East and South
    Date: 2013–01
  11. By: Grossmann, Volker; Steger, Thomas M.
    Abstract: A simple semi-endogenous growth model is employed to show that optimal subsidization of both R&D and capital costs is independent of the distribution of R&D skills in the workforce. This holds despite the empirically supported fact that a higher R&D subsidy rate raises wages of R&D workers. --
    Keywords: Optimal growth policy,R&D skills,R&D subsidy,Semi-endogenous growth,Heterogeneity
    JEL: O30 O40 H20
    Date: 2012
  12. By: De Vries, G.A.; Pennings, H.P.G.; Block, J.H.
    Abstract: We analyze the initial intellectual property (IP) right of 4,703 start-up entrants in the US, distinguishing between trademark and patent applications. The results show that start-ups are more likely to file for a trademark instead of a patent when entering into more competitive market structures. Further, we find that start-ups with a focus on distribution that serves end-consumers are more likely to file for a trademark and that start-ups that operate upstream and sell to other businesses are more likely to file for a patent. Lastly, the external influences on a start-up‟s management, such as the involvement of a venture capitalist (VC), affect IP applications. The increased incentive of VC-backed start-ups to become operational on the market makes them more likely to file initial IP in the form of a trademark rather than a patent. Among other factors, we control for R&D and advertising intensity in the industry and distinguish between more technical and more service-driven industries.
    Keywords: competition;intellectual property;trademarks;venture capital;patents
    Date: 2013–04–09
  13. By: Benoit, Jean-Pierre; Galbiati, Roberto; Henry, Emeric
    Abstract: Understanding the impact of legal protection on investment is of major importance. This paper provides a framework for addressing this issue, and shows that investment may actually be higher in the absence of legal protection. Focusing on the application to innovation, in an environment where an innovator (the host) repeatedly faces the same imitators (parasites), we show that investment can take place even without patent protection, as parasites limit their imitation to preserve the innovator's incentives to invest. We show further that an innovator might be more active without legal protection: it is forced to increase its investment to keep the parasites satisfied and, thus, cooperative. We provide experimental evidence consistent with the theoretical results: in the experiment, investment levels with and without legal protection are comparable, and sometimes greater without patents. Our framework is general enough to apply to other situations such as investment in developing countries, commons' management and long-distance trade.
    Keywords: experiment; investment; patent; repeated games
    JEL: C91 K0 O3
    Date: 2013–02
  14. By: Pedro Mazeda Gil (Faculdade de Economia, Universidade do Porto); Oscar Afonso (Faculdade de Economia, Universidade do Porto); Paulo Brito (ISEG, Universidade Técnica de Lisboa)
    Abstract: This paper builds an endogenous growth model of directed technical change with vertical and horizontal R&D and scale effects at the industry level to study an analytical mechanism that is consistent with the observed cross-country pattern in the skill structure, the technology structure and economic growth. We calibrate the model in order to uncover the effect of the skill structure on economic growth by studying how the former affects the technology structure. We find that the small positive elasticity of the economic growth rate regarding the ratio of high- to low-skilled workers that is empirically observed is explained by the combination of moderate levels of the market complexity costs related to vertical R&D and high entry costs in the high- vis-à-vis the low-tech sectors, which dampen the positive direct effect of the absolute productivity advantage of the high-skilled workers on growth
    Keywords: high-tech, low-tech, scale effects, skills, directed technical change
    JEL: O41 O31
    Date: 2012–09
  15. By: Daria Onori (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS; Université catholique de Louvain, IRES; University of Rome “La Sapienza”, Departement of Economics and Law, Faculty of Economics)
    Abstract: In this paper we modify a standard quality ladder model by assuming that R&D is driven by outsider firms and the winners of the race sell licenses over their patents, instead of entering directly the intermediate good sector. As a reward they get the aggregate profit of the industry. Moreover, in the intermediate good sector firms compete à la Cournot and it is assumed that there are spillovers represented by strategic complementarities on costs. We prove that there exists an interval of values of the spillover parameter such that the relationship between competition and growth is an inverted-U-shape.
    Keywords: quality ladder; Cournot oligopoly; strategic complementarities; competition
    JEL: L13 L16 O31 O52
    Date: 2013–04–02
  16. By: Raphaël Suire (University of Rennes 1 - CREM UMR CNRS 6211 - Institute for Digital Economics, Competition and Innovation (IDEC))
    Abstract: A third‐place (Oldenburg, 1991) is a place, most of time urban place, which is not exactly neither an office nor a home. This place is mainly dedicated to individual social capital building and relational asset production. Bars, cafe, airport or any public or private places with WiFI hot spot are third-­‐places. In the line of this seminal definition, a co-­‐ working place is a third-­‐place with some strong specificities dedicated to entrepreneurship and innovation that we would like to address in this paper.These places have emerged mainly in digital cities or cities with a technological or digital industrial sector. One of the raison d’être of this place is above all to help structuring epistemic community as well as give support to market and social innovation. Especially in France, local initiatives of this sort are burgeoning around “Cantine” (Canteen) and “network of Canteens”2 and the main issue of this chapter is to understand how these local initiatives around co-working places can help territory to enhance their market innovative capabilities and its disruptive and collective innovation potential. Having that in mind we suggest that a co-­‐working place can under specific condition reinforce a conformism lead to lock-­‐in situation whereas creativity and disruptive innovation are maximize under very specific structural configuration. Consequently, we suggest some good local public practices.
    Keywords: Innovation, third-place
    Date: 2013–01
  17. By: Roman Stöllinger
    Abstract: Technology is a key element for long-term growth and economic development. Given the stark concentration of innovation activities in a few countries most countries have to rely on the international diffusion of newly developed technologies. Some countries may fail to successfully perform the task of technology adaption leading to a tripartite segmentation of countries into an innovation club, an imitation club whose members are capable of absorbing technologies developed by the former and a stagnation group that lack the capability to absorb foreign technologies. We test the role of the technology gap for growth as suggested by the technology club hypothesis in a threshold regression framework using human capital as the threshold variable. Using this approach, which is related to Benhabib-Spiegel type growth regressions, we are able to identify two distinct thresholds giving rise to three country groupings. As suggested by the theory of technology clubs we find the strongest effects from the catch-up term on economic growth for the intermediate group (imitation club).
    Keywords: technology clubs, threshold regressions, technology spillovers, Schumpeterian growth model, human capital
    JEL: O47 O41 I25 O33
    Date: 2013–03
  18. By: Ottoz Elisabetta; Cugno Franco (University of Turin)
    Abstract: By using a simple model of patent settlement, in this paper we show that even if side payments (negative fixed fees) are banned, a licensing agreement to settle a patent dispute may harm consumers in comparison with the expected outcome of the lawsuit. This may occur when the challenger’s expected return from litigation is low, that is when probabilistic damages are high relative to the challenger’s duopoly profits. Our model suggests that: (1) there may be large benefits to consumers from post-grant reexamination of commercially valuable patents -as stressed by Farrell and Shapiro (2008) in another context; and (2) the threat of punitive damages for patent infringement may harm consumers in the short run, perhaps without being of any help in providing the right incentive to innovate.
    Date: 2012–01
  19. By: Ceren Ozgen (Department of Spatial Economics, VU University Amsterdam and bTinbergen Institute, Amsterdam,); Thomas de Graff (aDepartment of Spatial Economics, VU University Amsterdam)
    Abstract: An increasing amount of research in the migration literature shows a positive association between migrant diversity and rm productivity. However, the potential bias due to unobserved heterogeneity remains a challenge. In this paper we analyse the impact of cultural diversity on firm innovativeness, while using finite mixture modeling to control for observed and unobserved heterogeneity. Recent availability of microdata has enabled us to construct a linked employee- employer dataset through merging datasets on both workers and firms. We explore the possible ways of firm-level knowledge exchange among the employees with different cultural backgrounds and its impact on firms' product and process innovations. We find that workforce diversity is beneficial for innovativeness in capital-intensive sectors. It also positively impacts large firms that operate in high-level services, manufacturing, mining and R&D sectors, that are predominantly located in the non-urban areas in the Netherlands. In labour and land intensive sectors, the impact of cultural diversity on innovativeness is inconclusive.
    Keywords: Cultural diversity, innovativeness, (un-)observed heterogeneity, finite mixture modeling, migration
    JEL: J15 J21
    Date: 2013–04
  20. By: Dina Cunha (Faculdade de Economia, Universidade do Porto); Sandra T. Silva (Faculdade de Economia, Universidade do Porto, CEF.UP); Aurora A.C. Teixeira (Faculdade de Economia, Universidade do Porto, CEF.UP; INESC Porto, OBEGEF)
    Abstract: New Technology-Based Firms (NTBFs) have gained increasing economic relevance, supported by the recognition that they play an important role in national economies in the appearance of both new, high technology products and of new and emerging industries. Despite their economic importance, a number of alternative definitions for NTBFs are referred to in the literature, many of them adjusted to the aim of the study or the sample under observation. Such a lack of conceptualization reflects the variety of perspectives and interests of researchers, and has led to the need for a coherent framework to study NTBFs. Agreement has yet to be reached on which are the key characteristics of NTBFs. This lack of consensus in the conceptualization of NTBFs hinders the adequate applicability of the concept or a comparison among the different existing studies. Based on a sample of 30 Academic Spin- Offs (ASOs), and applying the criteria inferred conceptually, it was possible to conclude that, contrary to common wisdom, not all ASOs are NTBFs. Additionally, the ASOs classified as NTBFs, according to our criteria, differ significantly from the other ASOs, presenting a higher level of invested capital, higher R&D and internationalization intensity, and founding teams with a higher concentration of individuals with management capabilities.
    Keywords: New technology-based firms; Academic Spin-offs; Portugal
    JEL: O30 O32
    Date: 2013–01
  21. By: Pedro Mazeda Gil (Faculdade de Economia, Universidade do Porto); Oscar Afonso (Faculdade de Economia, Universidade do Porto); Paulo B. Vasconcelos (Faculdade de Economia, Universidade do Porto)
    Abstract: This paper presents an endogenous growth model of directed technical change with vertical and horizontal R&D to study an analytical mechanism that is consistent with the coexistence of aggregate stability and structural change. We focus on changes in the share of the high- versus the low-tech sectors in the context of a slow, but flexible, transitional dynamics that arises from a dynamic system with a three-dimensional stable manifold. Under the hypothesis of a positive shock in the proportion of high-skilled labour, the technological-knowledge bias channel leads to nonbalanced sectoral growth, while the aggregate variables remain approximately constant and thus consistent with the Kaldor facts. With prevailing market-scale effects, a calibration exercise shows that the model is able to account for around two-thirds of the increase in the share of the high-tech manufacturing sectors observed in European data from 1995 to 2007.
    Keywords: industry dynamics, Kaldor facts, high tech, low tech, directed technical change
    JEL: O41 O31
    Date: 2013–02
  22. By: Liliana Araújo (Faculdade de Economia, Universidade do Porto); Sandra T. Silva (CEF.UP, Faculdade de Economia, Universidade do Porto); Aurora A.C. Teixeira (CEF.UP, Faculdade de Economia, Universidade do Porto; INESC Porto, OBEGEF)
    Abstract: Extensive literature on the contribution of knowledge spillovers to growth and development at the regional level exists but these studies mainly features regions characterised by a high level of economic development. This paper assesses the importance of knowledge spillovers for firms located in relatively small, peripheral and economically depressed areas. Based on both primary (direct surveys to 257 firms) and secondary data, we concluded that the more relevant knowledge spillovers for firms located in a depressed region of northern Portugal (Vale do Ave) are inter-regional and international. This suggests that the contacts established with sources of knowledge from outside the region under analysis and abroad are crucial for the performance of firms. Despite the innovative intra-industry environment impacts positively on the economic performance of firms, our results convey that in such peripheral and depressed region geographical proximity is not critical for the firms’ economic performance.
    Keywords: Depressed areas; Evolutionary Economic Geography; Knowledge Spillovers, Innovation.
    JEL: R11 B52 D80 O3
    Date: 2013–03
  23. By: Josheski, Dushko; Fotov, Risto
    Abstract: In this paper issue of gravity modeling in international trade has been investigated. Standard gravity equation augmented with other variables to control for transportation cost, whether trade partners are neighbors and whether country is landlocked, or countries participants in trade have had colonial history together. Also in our model we control whether traded commodities are homogenous, differentiated or high tech , as well referenced. Variable to denote technology are :TAI index, which stands for technological achievement index, also variables for creation and diffusion of technology , as measured by the number of patents from the residents and royalty and license fees receipts, by the foreign citizens. Results are as expected and the show that trade is highly dependent on the exporters and importers levels of technology --
    Keywords: gravity model,bilateral trade
    JEL: F11 F41
    Date: 2013–03–26
  24. By: Schliessler, Paula
    Abstract: I analyse how patent litigation outcome in Germany affects the performance of the disputing firms by interpreting changes in a firm's credit rating as a proxy for changes in firm performance. The results match theoretical considerations on the functioning of the bifurcated German patent litigation system: The separation of litigation and invalidity decisions, resulting in invalidity decisions taking much longer than decisions on infringement, provides patent holders with a window of opportunity to enforce patents that may later be invalidated. This shifts a major share of the immediate risk to the defendant and allocates bargaining power to the plaintiff. The estimation results provide support for this incongruity. Plaintiffs on average profit from litigation while defendants agreeing upon a settlement deal lose as much as defendants losing in trial. I further show that small, inexperienced defendant firms are at a disadvantage when dealing with litigation. --
    Keywords: Patent,Patent Litigation,Credit Rating,Firm Value
    JEL: O34 K41
    Date: 2013
  25. By: Antonelli Cristiano (University of Turin)
    Abstract: Technological congruence is defined by the matching between the relative size of outputs’ elasticity with the relative abundance and cost of inputs in local factor markets. With given total costs, output is larger the larger is the output elasticity of the cheapest input. Technological congruence is a powerful tool that helps grasping many controversial aspects of growth accounting, international division of labor and specialization, technological and structural change. For years, it had received little attention because of the wide consensus that technological change was exogenous and neutral. But also subsequently, notwithstanding the developments made in the endogenous growth modeling, little attempt was made to provide a more advanced understanding of technological congruence. Its appreciation stems directly from the advances of the economics of innovation an d its recent developments in understanding the endogenous determinants of the in troduction and diffusion of directed technological changes. The levels of technological congruence are most relevant to influence the actual efficiency and to shape the competitive advance of firms and countries
    Date: 2013–02
  26. By: Adelaide Duarte (Faculty of Economics, University of Coimbra and GEMF, Portugal); Marta Simões (Faculty of Economics, University of Coimbra and GEMF, Portugal); João Sousa Andrade (Faculty of Economics, University of Coimbra and GEMF, Portugal)
    Abstract: The Portuguese growth and convergence experience after EU membership can be divided into two periods: 1986-1998, a convergence period during which growth in the Portuguese economy accelerated and Portugal grew faster than the EU14 average; and a stagnation/divergence period from 1999 onwards when its growth rate slowed down to figures lower than the reference group average. Differences among developed countries in terms of output levels and growth are mainly explained by differences in productivity, with Portugal falling behind relative to the EU14 in recent years as far as the former are concerned. In order to better understand the causes for the changes in the growth and convergence rhythm of the Portuguese economy after EU accession this paper analyses productivity growth in a panel of 14 European Union countries over the period 1986-2009. We estimate an empirical model where innovation and imitation provide two potential sources of productivity growth for countries behind the technological frontier, as is the case of Portugal, and those activities are in turn influenced by absorptive capacity and structural and institutional characteristics as well as capital accumulation. The results from the estimation of TFP growth regressions with quantile regression techniques reveal that, for lower rates of productivity growth, an increase of the non-tradables sector share is especially harmful, while the positive influence from technological backwardness and innovation activities are felt less strongly, while the positive influence from capital accumulation is felt more strongly. These results raise strong concerns concerning Portugal’s future growth prospects given its current specialization pattern towards traditional personal services and the country’s still considerable distance from the technological frontier and relatively low innovative intensity.
    Keywords: productivity growth, innovation, imitation, Portugal, EU.
    JEL: C23 O47 O52
    Date: 2013–02
  27. By: Jesse Perla (NYU); Christopher Tonetti (New York University)
    Abstract: While much of recent growth literature has focused on innovation in the technology frontier, less attention has been paid to the role of the least productive agents in generating growth. We develop an analytically tractable model where growth is created as a positive externality from risk taking by individuals at the bottom of the productivity distribution learning from more productive agents. Heterogeneous firms choose to produce or pay a cost and search for a better opportunity within the economy. Sustained growth comes from the feedback between the endogenously determined distribution of productivity, as evolved by past search decisions, and an optimal forward looking search policy. The growth rate depends on characteristics of the productivity distribution, with a thicker tailed distribution leading to more growth.
    Date: 2012
  28. By: Vassiliki Koutsogeorgopoulou; Omar Barbiero
    Abstract: Australia’s productivity growth has decelerated markedly around the turn of the century. Part of the decline is probably temporary, but raising multifactor productivity is key to ensure that living standards continue to grow strongly, especially if the currently strong terms of trade weaken over time. Recent efforts by the government are welcome. Ensuring responsive, high quality, vocational and higher education systems is indispensable to long-term growth. Raising the completion rate of vocational students, and enhancing the level of collaboration among the key innovation players are priorities. The productivityenhancing effects of infrastructure could be boosted by more effective and strategic planning, new sources of funding, and better use of existing capacity. Efficient pricing for infrastructure services and rapid progress towards harmonisation of regulations across states would boost competition and productivity.<P>Un nouvel élan pour la productivité en Australie<BR>La croissance de la productivité a sérieusement fléchi en Australie à l’aube du nouveau siècle. Une partie de ce recul est probablement temporaire, mais il est primordial d’augmenter la productivité globale des facteurs pour garantir une forte progression des niveaux de vie, en particulier si les termes de l’échange, actuellement favorables, devaient s’affaiblir dans le temps. Les initiatives récentes des autorités sont encourageantes. La garantie de systèmes d’enseignement professionnel et d’enseignement supérieur de qualité et capables d’adaptation est indispensable à la croissance à long terme. L’augmentation du taux de réussite des élèves en filière professionnelle et le renforcement du niveau de collaboration entre les principaux acteurs de l’innovation sont des objectifs prioritaires. Les effets de rationalisation de l’infrastructure sur la productivité pourraient être amplifiés par une planification stratégique plus efficace, de nouvelles sources de financement et une meilleure utilisation des capacités existantes. Enfin, une tarification optimale des services d’infrastructure et l’évolution rapide vers une harmonisation réglementaire entre les États doperaient la concurrence et la productivité.
    Keywords: productivity, education, Australia, innovation, regulation, transport, energy, infrastructure, multifactor productivity, water, higher education, vocational training, public-private partnerships, user charges, productivité, Australie, innovation, partenariats public-privé, éducation, transport, régulation, énergie, infrastructure, eau, productivité multifactorielle, formation professionnelle, éducation supérieure, péage routier
    JEL: H43 I21 L51 L91 L94 O3 O4 Q15
    Date: 2013–02–18
  29. By: Ottoz Elisabetta; Cugno Franco (University of Turin)
    Abstract: We study how different rules of legal-cost allocation impact on negotiated royalties in an environment where patent hold-up is possible. The model assumes that the courts routinely grant stays of permanent injunctions to allow the infringers to redesign their products or deny injunctive reliefs outright. In these scenarios we consider the American system, where each party bear s its own costs, the British system, where the loser incurs all costs, and the system favoring the defendant, where the defendant pays its own costs if it loses and nothing otherwise. Our main conclusions are that when stayed injunctions are granted the system favoring the defendant provides the best results, while under denied injunctions the American system is preferable
    Date: 2012–10
  30. By: Cerquera, Daniel; Klein, Gordon J.
    Abstract: This paper studies the impact of the adoption of ICT on the economic performance at the firm level, considering explicitly the interaction of adopting firms within the intermediate input market in Germany. The paper identifies and quantifies the importance of adoption externalities and knowledge spillovers inherent in the introduction of ICT. The results show that the adoption of ICT at the firm level is positively affected by the use of ICT downstream and upstream (i.e. by a firm's clients and suppliers). Moreover, the use of ICT upstream(i.e. by a firm's suppliers) negatively affects the extend of IT outsourcing at the firm level, suggesting a substitution effect between inputs provided by suppliers with an intense use of ICT and a firm's demand for external IT services. The paper also finds that the use of ICT within the intermediate input markets positively affects the efficiency of internal processes by increasing the cost reductions generated by the introduction of process innovations. --
    Keywords: Information and Communication Technologies,General Purpose Technologies,Intermediate Input Markets,Innovation,Firm Level Data
    JEL: D22 L25 O32
    Date: 2013

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