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on Innovation |
| By: | Matthias Siller; Christoph Hauser; Janette Walde; Gottfried Tappeiner |
| Abstract: | Measuring innovation activities involves critical decisions in selecting appropriate indicators and levels of observation. The present article contributes to the literature on this subject by addressing innovation measurement on the regional level. The dimensionality of regional innovation is examined by applying a principal component analysis on seven innovation output indicators in European regions from the Community Innovation Survey and two traditional indicators, i.e. patent applications and R&D expenses. The analysis reveals that regional innovation indeed needs to be regarded as a multidimensional concept involving technological, commercial and service innovation. These distinct innovation activities exhibit clear regional patterns with both technological and service innovation concentrated in highly developed territories and urban areas displaying particularly strong innovation performance in services. In addition, commercially successful innovation appears clustered in backward regions and may thus be seen as imitation efforts and technology transfers from areas at the innovation frontier. Overall, the elaborated findings suggest that the selection of innovation indicators in empirical analyses demands appropriate motivation and theoretical guidance. |
| Keywords: | regional innovation, innovation dimensions, Principal Component Analysis, patent applications, Community Innovation Survey |
| JEL: | R11 O31 O33 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2014-19&r=ino |
| By: | Keiichi Kishi (Graduate School of Economics, Osaka University) |
| Abstract: | In this paper, we introduce into a Schumpeterian growth model an inventive step: a minimum innovation size required for patents, which is a patentability requirement. We show that each R&D firm targets only the industries that the incumbentfs technology is sufficiently obsolete in order to satisfy an inventive step requirement. This is because a technological gap between innovator and incumbent is larger in the industries that use older technology. Under the circumstance, strengthening an inventive step requirement reduces the industries targeted by R&D, on the other hand, increases R&D investments to the targeted industries. Consequently, we find a nonmonotonic effect of the inventive step on the aggregate flow of innovations. |
| Keywords: | Technological progress, Innovations, Intellectual property rights |
| JEL: | O31 O34 O41 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1427&r=ino |
| By: | Alberto Galasso; Mark Schankerman |
| Abstract: | Cumulative innovation is central to economic growth. Do patent rights facilitate or impede follow-on innovation? We study the causal effect of removing patent rights by court invalidation on subsequent research related to the focal patent, as measured by later citations. We exploit random allocation of judges at the U.S. Court of Appeals for the Federal Circuit to control for endogeneity of patent invalidation. Patent invalidation leads to a 50 percent increase in citations to the focal patent, on average, but the impact is heterogeneous and depends on characteristics of the bargaining environment. Patent rights block downstream innovation in computers, electronics and medical instruments, but not in drugs, chemicals or mechanical technologies. Moreover, the effect is entirely driven by invalidation of patents owned by large patentees that triggers more follow-on innovation by small firms. |
| JEL: | O33 O34 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20269&r=ino |
| By: | Caroline Mothe; Uyen T. Nguyen-Thi; Phu Nguyen-Van |
| Abstract: | We empirically investigate the pattern of complementarity between four organizational practices. Firm-level data were drawn from the Community Innovation Survey (CIS) carried out in 2008 in Luxembourg. Supermodularity tests confirm the crucial role of organizational innovation in raising firms’ technological innovation. The pattern of complementarity between organizational practices differs according to the type of innovation, i.e. product or process innovation, but also according to whether the firm is in the first stage of the innovation process (i.e. being innovative or not) or in a later stage (i.e. innovation performance in terms of sales of new products). |
| Keywords: | Complementarity, Organizational innovation, Substitution, Supermodularity, Technological innovation. |
| JEL: | D22 O32 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2014-12&r=ino |
| By: | Joel Stiebale |
| Abstract: | This paper analyzes the effects of cross-border mergers and acquisitions (M&As) on the innovation of European firms. The results indicate a considerable increase in post-acquisition innovation in the merged entity. This is mainly driven by inventors based in the acquirer's country, while innovation in the target's country tends to decline. The asymmetry of effects between acquiring and target firms increases with pre-acquisition differences in knowledge stocks, indicating a relocation of innovative activities to more efficient usage within multinational firms. Instrumental variable techniques as well as a propensity-score matching approach indicate that the effect of cross-border M&As on innovation is causal. |
| Keywords: | Multinational Enterprises, Mergers and Acquisitions, Innovation |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:not:notgep:14/06&r=ino |
| By: | Irlacher, Michael |
| Abstract: | In this paper, I investigate welfare gains associated with trade induced intra-firm adjustments of multi-product firms. To disentangle the welfare gains, I split up the R&D portfolio of a multi-product firm into three different channels: i) product innovation, ii) investments in the degree of product differentiation, and iii) process innovation. Trade integration enables firms to exploit economies of scale as innovation requires upfront development costs and encourages firms to spend more on R&D. I derive the indirect utility function and show that consumers bene.t from this behavior through a larger product range (love of variety) which is also more differentiated (love of diversity). Furthermore, a larger market is associated with technology upgrading. The resulting cost savings are passed on to consumers, leading to welfare gains from lower prices. |
| Keywords: | International Trade; Multi-Product Firms; Gains from Trade; R&D; Cannibalization Effect; Product Differentiation |
| JEL: | F12 L25 |
| Date: | 2014–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:21023&r=ino |
| By: | Flach, Lisandra; Irlacher, Michael |
| Abstract: | This paper studies the innovation strategies of multi-product firms in industries with different scope for product differentiation. In a simple model of multi-product firms, we show that returns to product versus process innovation are industry-specific. Demand and cost linkages induce a natural distinction between the returns to product and process innovation. In highly differentiated industries, the cannibalization effect is lower and, therefore, firms invest more in product innovation. In homogeneous industries, firms internalize intra-firm spillover effects and invest more in process innovation. We test the predictions from the model using Brazilian firm-level data, with information on investment efforts over time. Following a major exchange rate devaluation, firms have better access to foreign markets and exploit economies of scale in innovation. However, detailed information on product and process innovation allows us to evaluate differential effects across industries. We con.rm the predictions from the theoretical model and show that the type of innovation depends on the industry scope for differentiation. |
| Keywords: | Multi-Product Firms; Innovation; Product Differentiation; Cannibalization Effect; Spillovers; Globalization |
| JEL: | F12 F14 L25 |
| Date: | 2014–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:21022&r=ino |
| By: | Mickael Benaim; Jean-Alain Héraud; Valérie Mérindol; Jean-Paul Villette |
| Abstract: | The diversity of European regions in terms of R&D and of absorptive capacities has been extensively investigated but without taking into account all dimensions of the regional innovation systems. Even though the variety of connections is a source of constraints and opportunities for the development of territories, few analytical contributions have been devoted so far to this subject and to the implications for regional public policies. This article aims at contributing to the analysis of regional research and innovation systems. It focuses on the different types of scientific connectivity present at local to global levels, and proposes a typology of European regions based on co-publication statistics. It links this characterization of European regions with regional policy issues and discusses the relevance of these measures. The typology of scientific connectivity produces new maps of European regions, and challenges the classical R&D point of view about regional systems. |
| Keywords: | European regions, global-local connectivity, regional public policy, absorptive capacity, scientific activities. |
| JEL: | O18 O31 R11 R58 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2014-13&r=ino |
| By: | Valeria Costantini (Department of Economics, Roma Tre University, Roma (Italy).); Francesco Crespi (Department of Economics, Roma Tre University, Roma (Italy).); Ylenia Curci (Department of Economics, Roma Tre University, Roma (Italy).) |
| Abstract: | In this paper we propose an innovative methodology that aims to solve drawbacks related to how patent data are allocated and organized in international databases. We propose as a case study the biofuels sector, in order to evaluate the validity of such a method. Starting with a systematic mapping of biofuels production value chain, we have built a comprehensive description of the biofuels technological domain. The resulting list of keywords relies on an iterative selection approach, based on an analysis of recent scientific literature combined with the keyword search tool developed by Scopus. The final patent database, BioPat, has been finalized by a validation procedure with the help of expert interviews, revealing improved accuracy compared with standard IPC-based codes. Collected information in BioPat allows us to derive more intriguing insights on the characteristics and evolution of technological patterns in the biofuels sector with respect to standard classification methods. |
| Keywords: | patents classification, keyword selection, innovation patterns, liquid biofuels, knowledge complexity. |
| JEL: | O31 O33 Q42 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:srt:wpaper:1714&r=ino |
| By: | Emanuele Brancati (LUISS University of Rome) |
| Abstract: | Financial frictions represent a severe obstacle to firmsÕ innovativeness. This paper shows the existence and quantifies the effects of financial barriers to the innovation propensity of Italian SMEs. Employing direct measures of financial constraints and a credit-score estimated ad hoc, I find financially-constrained firms have a probability of innovating that is significantly lower than sound companies (-30%). Results document the existence of a feedback-effect of innovation on firmsÕ financial position, resulting into an additional reduction in firmsÕ propensity to innovate. The paper also highlights the role of soft information in mitigating financial obstacles to innovation by improving the financial condition of more opaque (small) borrowers. |
| Keywords: | Innovation, financial constraints, relationship lending, SMEs. |
| JEL: | O31 L25 G21 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:lui:casmef:1403&r=ino |
| By: | Cardamone, Paola |
| Abstract: | The aim of this paper is to evaluate the effect of research and development (R&D) on productivity by taking into account productivity spillovers. To this end, by using a sample of Italian manufacturing firms provided by the Xth UniCredit-Capitalia survey (2008), which covers the period 2004-2006, we have analyzed the role of R&D in firm productivity by using a spatial autoregressive model. In so doing, we have allowed the total factor productivity (TFP) of each firm to be affected by the TFP of nearby firms. Results show that R&D play an important role in Italian firm productivity. Moreover, we find evidence in favor of productivity spillovers across firms due to spatial proximity. In addition, intrasectoral R&D spillovers seem to have a relevant effect on firm productivity, while intersectoral R&D spillovers do not have a significant effect. |
| Keywords: | R&D, TFP, spillovers, spatial econometrics, Italian manufacturing firms |
| JEL: | C21 D24 O33 |
| Date: | 2014–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57149&r=ino |
| By: | Curatola, Giuliano; Donadelli, Michael; Gioffré, Alessandro; Grüning, Patrick |
| Abstract: | This paper contributes to the ongoing debate on the relationship between austerity measures and economic growth. We propose a general equilibrium model where (i) agents have recursive preferences; (ii ) economic growth is endogenously driven by investments in R&D; (iii) the government is committed to a zero-deficit policy and finances public expenditures by means of a combination of labor taxes and R&D taxes. We find that austerity measures that rely on reducing resources available to the R&D sector depress economic growth both in the short- and long-run. High debt EU members are currently implementing austerity measures based on higher taxes and/or lower investments in the R&D sector. This casts some doubts on the real ability of these countries to grow over the next years. -- |
| Keywords: | Austerity Measures,Fiscal Policy,Endogenous Growth,R&D |
| JEL: | G12 G15 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:56&r=ino |
| By: | Corrado, Carol (The Conference Board); Haskel, Jonathan (Imperial College London); Jona-Lasinio, Cecilia (ISTAT, Rome) |
| Abstract: | This paper looks at the channels through which intangible assets affect productivity. The econometric analysis exploits a new dataset on intangible investment (INTAN-Invest) in conjunction with EUKLEMS productivity estimates for 10 EU member states from 1998 to 2007. We find that (a) the marginal impact of ICT capital is higher when it is complemented with intangible capital, and (b) non-R&D intangible capital has a higher estimated output elasticity than its conventionally-calculated factor share. These findings suggest investments in knowledge-based capital, i.e., intangible capital, produce productivity growth spillovers via mechanisms beyond those previously established for R&D. |
| Keywords: | productivity growth, economic growth, intangible capital, intangible assets, ICT, spillovers |
| JEL: | O47 E22 E01 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8274&r=ino |
| By: | Crespo, Aranzazu |
| Abstract: | This paper proposes a trade model with heterogeneous firms that decide not just whether and how much to export but also whether and how much to innovate. Incorporating both the extensive and intensive margins of trade and innovation leads to different possible equilibria. Depending on how costly trade is relative to innovation, medium-productivity firms may either export without innovating, innovate without exporting, do both or do neither. The impact of trade on aggregate productivity and welfare depends crucially on the equilibrium the economy is in. When lowering the variable costs of trade, the welfare effects arising from reallocating market shares across firms may be non-negligible, and when lowering the fixed cost of trade, aggregate productivity need not always increase. After calibrating the model to five European countries, we show that the different equilibria are plausible, and provide quantitative evidence that supports the predictions of our theory. |
| Keywords: | Process Innovation, Firm Heterogeneity, Trade Policy |
| JEL: | F12 F13 O24 O31 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57162&r=ino |
| By: | Cardamone, Paola; Pupo, Valeria; Ricotta, Fernanda |
| Abstract: | The aim of this paper is to assess the effect on firm total factor productivity of the university research. Since the impact of universities on firms’ performance is subtle and complex, we verify whether territorial context, sector and firm size may influence this relationship. Results show that university R&D does not seem to affect Italian firm productivity. However, if we consider geographical location and sector, we find that university activities have a positive effect on the performance of firms located in the North of Italy or operating in the specialised supplier sector. Several robustness checks confirm the significant role played by universities above all in the North of Italy. The policy implications of these findings are discussed. |
| Keywords: | University, R&D, Total Factor Productivity |
| JEL: | C21 D24 O30 |
| Date: | 2014–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57034&r=ino |
| By: | Lubica Hikkerova; Niaz Kammoun; Jean-Sébastien Lantz |
| Abstract: | Patents and their renewals are critical because they protect inventions and reinforce information reported to investors about the utility and the quality of inventions. Thus, they signal the appropriate use of financial resources being invested, notably |
| Keywords: | atent renewal, abandonment, life cycle, valuation, intellectual property, delivery term, patent citations, claims. |
| Date: | 2014–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:ipg:wpaper:2014-367&r=ino |
| By: | Pelkonen, Antti – Thomas |
| Abstract: | While societal expectations for university research have grown, university research has become more and more dependent on external funding sources. External funding has substantially increased at Finnish – and also UK – universities, and currently in practice a major share of university research is conducted with external funding. This report relates the main findings of a study that analysed the use of project-based research funding instruments at universities, most of which are external. The main focus in the study is on the aspects of novelty and creativity in research and the question of the extent to which different research funding instruments promote these aspects of research. This report draws on different data sources, but mostly on the UNI project (Universities, funding systems, and the renewal of the industrial knowledge base), funded by Tekes innovation research instrument. The major findings include an observation that Finnish research funding system lacks a funder that would strongly encourage risk-taking and novel approaches. Discontinuity and instability of research funding appears as a major challenge for research. There seems to be an overall increase of thematically predefined funding vis-à-vis free researcher-driven funding and close attention should be paid to this balance. Differences between Finland and the UK in terms of novelty generation turned out to be smaller than orignally expected. |
| Keywords: | funding, university research, novelty |
| JEL: | O38 O39 |
| Date: | 2014–06–12 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:29&r=ino |
| By: | Andrew Tiffin |
| Abstract: | In Italy, price-based competitiveness measures are not always an accurate predictor of trade outcomes. This paper offers a more comprehensive assessment of Italian competitiveness, focusing on the role of innovation and the evolution of Italy’s export market share. Overall, Italy maintains a high-quality export mix, and the adaptability of small-scale specialized firms is still a source of strength. But, small firm size is becoming less of an asset, and even the most innovative sectors are weighed down by the structural barriers that have depressed productivity more broadly. Italy’s future competitiveness will depend on full implementation of a comprehensive structural-reform agenda. |
| Keywords: | Global competitiveness;Italy;Exports;Productivity;Labor costs;Italy, competitiveness, exports, shift share analysis, CMSA |
| Date: | 2014–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:14/79&r=ino |
| By: | Tiwari, Rajnish; Kalogerakis, Katharina; Herstatt, Cornelius |
| Abstract: | Frugal products and services aim at satisfying the unsaturated demand of a large and growing middle class in many emerging economies. Although research has been conducted in regard to the strategic importance of frugal innovations, so far, the actual development process of such innovations has not been looked into in detail. Some examples show that inventive analogies are used to develop frugal innovations. For instance, the development of a frugal artificial heart was based on the heart structure of cockroaches, which led to a reduction of costs by 20 times. The aim of this paper is to examine the use of inventive analogies in creating frugal solutions and their impact on project results. Based on three explorative case studies from India, the authors generate preliminary evidence that analogies can make a significant impact on the successful development of innovations in environments that are characterized by severe resource constraints and high price-sensitivity. Furthermore, the inherent aim of frugal innovations to create radically new solutions with very restricted resources seems to stimulate the application of inventive analogies. The results point to some valuable learnings in regard to an effective employment of analogies. Besides, useful insights for companies that want to exploit market opportunities in the emerging economies are generated. -- |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:tuhtim:84&r=ino |
| By: | Ken Warwick; Alistair Nolan |
| Abstract: | Industrial policy, broadly defined, covers a multitude of policy instruments and approaches. While there has been a recent revival of interest in industrial policy around the world, systematic evidence of efficacy is relatively scarce. This report brings together the work of an OECD expert group that has considered recent evidence from the evaluation of industrial policy. The report focuses on three specific policy areas, namely: support for R&D; capital market interventions (with a focus on risk capital); and public procurement for innovation. The report also examines three areas where packages of industrial policy measures are generally applied: sector approaches including public-private partnerships; policies towards clusters and business networks; and national industrial strategies. In many areas of industrial policy, evaluation faces particular methodological challenges. These challenges are outlined in the report, which concludes by drawing together the main policy lessons from the available evaluation evidence. |
| Date: | 2014–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:oec:stiaac:16-en&r=ino |
| By: | Antonelli, Cristiano; Scellato, Giuseppe (University of Turin) |
| Abstract: | The analysis of the characteristics of firms helps understanding the causes and the consequences of the direction of technological change. Firms differ substantially with respect to the type of technological knowledge they can generate and exploit with the introduction of technological innovations. This in turn has major effects on the direction of technological change they are able to introduce. Large firms able to command the recombinant generation of codified knowledge with a strong scientific base are more likely to introduce neutral technological changes that consist in a shift effect of production functions. Small firms that rely more on tacit and external knowledge are more likely to rely on technologies directed towards the most intensive use of locally abundant production factors. The effects of this difference in terms of the resulting total factor productivity growth are important and can be grasped only when the changes of output elasticity of production factors in growth accounting are properly appreciated. The empirical evidence for a sample of 6600 Italian firms observed during the years 1996 - 2005 confirms that large firms introduced mainly neutral technological changes while small firms with lower levels of profitability introduced biased technological changes. |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:uto:dipeco:201417&r=ino |
| By: | Maloney, William F. (World Bank); Caicedo, Felipe Valencia (Universitat Pompeu Fabra) |
| Abstract: | Using newly collected national and sub-national data and historical case studies, this paper argues that differences in innovative capacity, captured by the density of engineers at the dawn of the Second Industrial Revolution, are important to explaining present income differences, and, in particular, the poor performance of Latin America relative to North America. This remains the case after controlling for literacy, other higher order human capital, such as lawyers, as well as demand side elements that might be confounded with engineering. The analysis then finds that agglomeration, certain geographical fundamentals, and extractive institutions such as slavery affect innovative capacity. However, a large effect associated with being a Spanish colony remains suggesting important inherited factors. |
| Keywords: | innovative capacity, engineers, technology diffusion, human capital, growth, development, history |
| JEL: | O1 O31 O33 O4 N1 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8271&r=ino |