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on Innovation |
| By: | Daron Acemoglu; Ufuk Akcigit; Nicholas Bloom; William R. Kerr |
| Abstract: | We build a model of firm-level innovation, productivity growth and reallocation featuring endogenous entry and exit. A key feature is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using detailed US Census micro data on firm-level output, R&D and patenting. The model provides a good fit to the dynamics of firm entry and exit, output and R&D, and its implied elasticities are in the ballpark of a range of micro estimates. We find industrial policy subsidizing either the R&D or the continued operation of incumbents reduces growth and welfare. For example, a subsidy to incumbent R&D equivalent to 5% of GDP reduces welfare by about 1.5% because it deters entry of new high-type firms. On the contrary, substantial improvements (of the order of 5% improvement in welfare) are possible if the continued operation of incumbents is taxed while at the same time R&D by incumbents and new entrants is subsidized. This is because of a strong selection effect: R&D resources (skilled labor) are inefficiently used by low-type incumbent firms. Subsidies to incumbents encourage the survival and expansion of these firms at the expense of potential high-type entrants. We show that optimal policy encourages the exit of low-type firms and supports R&D by high-type incumbents and entry. |
| Keywords: | industrial policy, productivity growth, innovation, R&D |
| JEL: | E02 L1 O31 O32 O33 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1216&r=ino |
| By: | Wladimir Raymond; Jacques Mairesse; Pierre Mohnen; Franz Palm |
| Abstract: | This paper introduces dynamics in the R&D to innovation and innovation to productivity relationships, which have mostly been estimated on cross-sectional data. It considers four nonlinear dynamic simultaneous equations models that include individual effects and idiosyncratic errors correlated across equations and that differ in the way innovation enters the conditional mean of labor productivity: through an observed binary indicator, an observed intensity variable or through the continuous latent variables that correspond to the observed occurrence or intensity. It estimates these models by full information maximum likelihood using two unbalanced panels of Dutch and French manufacturing firms from three waves of the Community Innovation Survey. The results provide evidence of robust unidirectional causality from innovation to productivity and of stronger persistence in productivity than in innovation. <P>Dans ce papier, nous introduisons de la dynamique dans le modèle Crépon-Duguet-Mairesse (CDM), à la fois entre la R-D et l’innovation et entre l’innovation et la productivité. Le modèle CDM a généralement été estimé sur des données en coupe transversale. Nous proposons quatre modèles dynamiques à équations simultanées avec des effets individuels et des effets idiosyncratiques corrélés entre équations. Ces modèles diffèrent dans la façon dont l’innovation apparaît dans l’équation de productivité : à travers une variable binaire ou une variable continue, et à travers une mesure observée ou une mesure latente de l’innovation. Les modèles sont estimés par maximum de vraisemblance sur des données panel d’entreprises françaises et néerlandaises provenant de trois vagues des enquêtes communautaires d’innovation. Les résultats sont robustes et montrent que la causalité est unidirectionnelle allant de l’innovation à la productivité, et que la persistance est plus forte dans la productivité que dans l’innovation. |
| Keywords: | R&D, Innovation, Productivity, Panel data, Dynamics, Simultaneous equations, R-D, innovation, productivité, données panel, dynamique, équations simultanées |
| Date: | 2013–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2013s-12&r=ino |
| By: | Fernandes, Cristina; Ferreira, João; Raposo, Mario |
| Abstract: | This research aims to analyse the drivers to company innovation and their effects on the financial performance. This study is based upon a sample of companies, located in two neighbouring countries (Portugal and Spain). Linear regression was the methodology deployed to analyse the importance of innovation types (differences between Portugal and Spain). To analyse the extent to which the innovation capacity variables influence financial performance (turnover), we made recourse to Probit Regression models. Our results show significant differences in terms of both the drivers and inhibitors to innovation in these two countries. The introduction of products into new markets only proved significant at Spanish companies whilst innovations in both products and processes are significant in both sets of Iberian companies. |
| Keywords: | innovation firm, innovation capacities, financial performance, Iberian countries |
| JEL: | M1 M10 M21 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:46776&r=ino |
| By: | Leung, Vincent K.K.; Lau, Chi Keung Marco; Zhang, Zhe |
| Abstract: | This study empirically delineates the nature of explorative and exploitative alliances, examines how they affect product and process innovations, and investigates how such effects vary in different contexts. Using a sample of 220 Chinese firms in the glass industry, we find that explorative alliances have a stronger effect on both product and process innovations than exploitative alliances. Product and process innovations are positively related to both market and efficiency performance and environmental turbulence enhances the effect of product and process innovations. Our findings provide implications on how to choose between explorative and exploitative alliances relative to the alliance objectives and firm resources and environmental contexts. |
| Keywords: | China, exploration versus exploitation, structural equation modeling, process innovation, product innovation, small-and-medium-sized enterprises |
| JEL: | D21 D7 L65 N60 |
| Date: | 2013–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47065&r=ino |
| By: | YoungGak KIM; ITO Keiko |
| Abstract: | In this paper, using a large-scale dataset covering both Japanese and Korean firms, we examine the differences in performance and research and development (R&D) activities between them. We find that Japanese firms tend to be more productive in terms of total factor productivity (TFP), and that the productivity gap has not been narrowing in most industries. However, Korean firms are superior in terms of labor productivity and profitability. On the other hand, in recent years, Korean firms on average have tended to have a higher R&D intensity. In particular, smaller Korean firms have been actively increasing their R&D expenditures.<br />We also find that the rate of return on R&D for large/productive firms is much higher in Korea, while that for small/less productive firms does not significantly differ. The relatively low rate of return for small/less productive firms may explain why Korea's average TFP level is not catching up with that of Japan. On the other hand, the rate of return on R&D for large firms is low in Japan, warranting further investigation on the factors underlying this. |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:13043&r=ino |
| By: | Russell Golman; Steven Klepper |
| Abstract: | Geographic clustering of industries is typically attributed to localized, pecuniary or non-pecuniary externalities. Recent studies across innovative industries suggestthat explosive cluster growth is associated with the entry and success of spinoff firms. We develop a model to explain the patterns regarding cluster growth and spinoff formation and performance, without relying on agglomeration externalities. Clustering naturally follows from spinoffs locating near their parents. In our model, firms grow and spinoffs form through the discovery of new submarkets based on innovation. Rapid and successful innovation creates more opportunities for spinoff entry and drives a region’s growth. |
| Keywords: | Agglomeration, Clusters, Entry, Innovation, Spinoffs |
| JEL: | L25 O31 R12 R30 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1309&r=ino |
| By: | Akifumi Ishihara (Kyoto University); Noriyuki Yanagawa (The University of Tokyo) |
| Abstract: | This paper examines roles of patent pools with compulsory independent licensing. A seminal work by Lerner and Tirole (2004) have shown that requiring independent licensing or compulsory independent licensing is a useful tool to select only desirable patent pools. In this paper, however, we are going to show that their argument is not always true, If there are users who demand only a part of the pooled technologies, the compulsory independent licensing gives a tool for price discrimination for the patent holders, and that is welfare decreasing under some conditions. Moreover, the compulsory independent licensing may promote entry deterrence when there are lower grade entrants. Even in this sense, compulsory independent licensing decreases social welfare. The welfare under the patent pool with independent licensing may become lower than that under the competitive licensing. |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:cfi:fseres:cf318&r=ino |
| By: | Yamauchi, Isamu; Nagaoka, Sadao |
| Abstract: | This paper investigates the effects of outsourcing of prior art search on the efficiency of patent examination, using a large scale Japanese patent examination data. Outsourcing may increase examination quality by expanding the scope of prior art search, while it may have a negative effect if the synergy between search and examination is important. If examination quality is the predominant concern for outsourcing decision and the outsourcing is constrained by budgetary resources, we expect that outsourcing enhances examination quality at its margin. On the other hand, if an examiner can save private cost by outsourcing, an increase in outsourcing can decrease the quality. Controlling for the endogeneity of outsourcing decision as well as examiners’ fixed effects, we found that the outsourcing of prior art search significantly decreased the frequency of appeals against both examiners’ rejection and grant decisions and reduced the length of examination duration. At the same time we found that the prior art search of complex inventions is not outsourced. These suggest that the opportunity for exploiting external knowledge and capability can increase the quality as well as the speed of examination. |
| Keywords: | patent, examination, outsourcing, search, prior art |
| JEL: | O38 O34 O30 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:hit:iirwps:13-12&r=ino |
| By: | Diego A. Comin; Martí Mestieri |
| Abstract: | This chapter discusses different approaches pursued to explore three broad questions related to technology diffusion: what general patterns characterize the diffusion of technologies, and how have they changed over time; what are the key drivers of technology, and what are the macroeconomic consequences of technology. We prioritize in our discussion unified approaches to these three questions that are based on direct measures of technology. |
| JEL: | E0 F0 N0 O0 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19052&r=ino |
| By: | Murayama, Kota; Nirei, Makoto; Shimizu, Hiroshi |
| Abstract: | This study investigates the impact of management style on research performance in science. If a managerial role is played by a leading scientist in the research team, that is considered management-research integration. If not, we consider that management and research are separated. We found that separating the managerial and research role has a positive effect on the number of papers published for that research project. In contrast, management-research integration is positively associated with the quality of the paper through allowing researchers to pursue serendipitous findings. These results show the trade-off between research efficiency and quality in science via who plays the managerial role and the leading research role. |
| Keywords: | science, serendipity, productivity, research management |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:hit:iirwps:13-13&r=ino |