nep-ino New Economics Papers
on Innovation
Issue of 2014‒12‒24
23 papers chosen by
Steffen Lippert
University of Auckland

  1. Radical or incremental: Where does R&D policy hit? By Beck, Mathias; Lopes-Bento, Cindy; Schenker-Wicki, Andrea
  2. Does Connectivity Impact Innovation Performance in Rural Regions? By Pia Wassmann; Daniel Schiller; Stephan Thomsen
  3. Does issuing equities help R&D activity? Evidence from unlisted Italian high-tech manufacturing firms By Silvia Magri
  4. The innovation and its territorial factors: An analysis in the micro-regions of São Paulo. By Suelene Mascarini
  5. Direct and cross-scheme effects in a research and development subsidy program By Hottenrott, Hanna; Lopes-Bento, Cindy; Veugelers, Reinhilde
  6. Trade Liberalization and Optimal R&D policies with Process Innovation. By Thanh Le; Cuong Le Van
  7. A Survey of the Economics of Patent Systems and Procedures By Eckert, Andrew; Langinier, Corinne
  8. Innovation in creative cities: Evidence from British small firms By Lee, Neil; Rodriguez-Pose, Andres
  9. ROSIS: A Regional Open Sectoral Innovation System By Igone Porto; Jose Ramón Otegi
  10. Research intensive clusters and regional innovation systems: a case study of mechatronics in Apulia By Massimo Florio; Julie Pellegrin; Emanuela Sirtori
  11. Hiring New Ideas: International Migration and Firm Innovation in New Zealand By Keith McLeod; Richard Fabling; David C. Maré
  12. Does Board Diversity Influence Firms' Innovative Activity? Evidence from the firm-level micro data in Japan (Japanese) By INUI Tomohiko; NAKAMURO Makiko; EDAMURA Kazuma; OZAWA Junko
  14. What types of firms tend to be more innovative: A study on Germany By Stephan Brunow; Valentina Nafts
  15. Patents and the Global Diffusion of New Drugs By Cockburn, Iain M; Lanjouw, Jean O; Schankerman, Mark
  16. Exploring the international connectivity of Chinese inventors in the pharmaceutical industry By Alessandra Perri; Vittoria Giada Scalera; Ram Mudambi
  17. Firms’ Innovation, Constrains and Productivity: the Case of Peru By Mario Tello
  18. The diffusion of patented oil and gas technology with environmental uses: a forward patent citation analysis By Maria Teresa Costa; Nestor Duch-Brown
  19. R&D and Regional Regeneration. The Case of Alba Subregion in Romania By Zizi Goschin; Georgiana-Gloria Goschin
  20. Regulating the negative externalities of enterprise cluster innovations : Lessons from Vietnam By Voeten, J.; Naudé, Wim
  21. European Cluster Networks ? Insights from 7th EU Framework Program By Mirko Titze; Matthias Brachert
  22. Designing an Optimal 'Tech Fix' Path to Global Climate Stability: Integrated Dynamic Requirements Analysis for the 'Tech Fix' By Paul David; Adriaan van Zon
  23. A Virtuous Cumulative Growth Circle among Innovation, Inclusion and Sustainability? A Structuralist-Keynesian Analysis with an Application on Europe By Giulio Guarini; Giuseppe Garofalo; Alessandro Federici

  1. By: Beck, Mathias; Lopes-Bento, Cindy; Schenker-Wicki, Andrea
    Abstract: This study investigates the efficacy of public R&D support. Compared to most existing studies, we do not stop at substitution effects or general innovation outcome measures, but we are interested in knowing where the policy effect is highest: on innovation close to the market (i.e. incremental innovation) or on innovation that is still far from the market and hence more risky and radical. Using firm level data from the period 1999 to 2011, we find that the policy hits where the market failure is highest, that is, for radical innovation. Taking into account that the Swiss funding agency encourages collaboration, we find no evidence that the impact of the policy is positively effected by various R&D collaboration patterns.
    Keywords: R&D subsidies,collaborative innovation,diversity,innovation performance,radical innovation,incremental innovation,policy evaluation,treatment effects
    JEL: C14 C30 H23 O31 O38
    Date: 2014
  2. By: Pia Wassmann; Daniel Schiller; Stephan Thomsen
    Abstract: There is a broad consensus in the literature in that R&D is a precondition for innovation and in turn, for economic growth. On the regional level, this implies that regions with a high stock of R&D should reveal better results when it comes to economic performance. This presumption has lead policy-makers to focus especially on strengthening the regional stock of R&D as an instrument to foster the regional innovation performance. However, the relation between regional R&D and economic growth may not be as straightforward and an exclusive concentration on R&D may not be appropriate for stimulating regional innovation. Thus, empirical evidence shows that some regions perform well in economic terms, irrespective of their relatively low values of R&D. One of these regions is the German region of Lower Bavaria. This region performs well above the German average in terms of economic growth and employment. At the same time, the regional performance on the traditional R&D indicators as patents or the share of human resources in science and technology is below average. Yet, despite the disadvantageous values on the latter, a recent study of regional firms has indicated that over 60% have introduced either a technological or non-technological innovation in the past three years. One explanation for this contra-intuitive finding emerges from the potential connectivity of regional firms, enabling them to acquire R&D from external knowledge sources. This aspect is in focus of this paper. Thus, based on original firm-level data, we investigate how connectivity impacts innovation performance of firms in the low R&D region of Lower Bavaria. The idea that innovation is a result of an interactive process and that firms have to acquire external knowledge in order to innovate is certainly not new. However, despite the fact that regional connectivity especially of low R&D regions has gained considerable importance, not at least reflected by the current EU innovation policy debate, there are only a few studies that assess the association between cooperation and innovation in regions with low internal R&D in a systematic, quantitative manner. Rather, the majority of studies focus on high-tech regions with strong initial R&D. With the emphasis on a rural region with mainly low- and medium-tech industries, this paper aims to bridge this gap and to study the relation in a type of region that has not been comprehensively examined, yet. Moreover, by distinguishing between the geographical and functional dimension of cooperation as well as by the consideration of both, technological and non-technological forms of innovation, we provide a more encompassing view on how firms in this type of regions use cooperation to increase their innovation potential.
    Keywords: innovation; connectivity; low-tech industries; rural region; R&D; Germany;
    JEL: R11 O18 O31 L25
    Date: 2014–11
  3. By: Silvia Magri (Bank of Italy)
    Abstract: This paper evaluates the causal effect of issuing equities on the probability that a firm will engage in R&D activity. Equity is a preferable source of external finance for innovation than debt. It does not require collateral, does not exacerbate moral hazard problems connected with the substitution of high-risk for low-risk projects, quite common when using debt, and, unlike debt, does not increase the probability of bankruptcy; equity also allows investors to reap the entire benefit of returns on successful innovative projects. The paper focuses on high-tech firms for which asymmetric information problems are more pervasive. Implementing an instrumental variable estimation, we find that issuing equity increases the probability of the firm making R&D expenditure by 30-40 per cent. We detect considerable heterogeneity across firms: the impact of issuing equity is significant only for small, young, and more highly leveraged firms. We also find interesting evidence that issuing equity increases R&D expenditure in relation to sales.
    Keywords: R&D, innovation, equity issues, high-tech firms
    JEL: G21 G32 O31 O32
    Date: 2014–10
  4. By: Suelene Mascarini
    Abstract: This paper aims to examine empirically, through the application of the Knowledge Production Function, how the innovation in micro-region of São Paulo can be affected for some territorial factors. In the literature, and assumed here, the innovative results, measured by patents, are linked to the quantity and quality of innovative inputs and characteristics of the regions that are configured as an input. In this sense, stands the importance of positive externalities that are generated by the spatial concentration of producers and support institutions that are able to contribute to the efforts of innovative firms. In addition, this paper emphasizes the role of local production structures in the regions of São Paulo, since both the regional diversification and regional specialization are mentioned as important factors in the innovation process. The main results suggested that although the level of R&D investments were important for generating local innovation, ie, the generation of local patents, this relationship does not occur clearly in the regions of São Paulo. In addition, local productive structure or density linkages of firms that interacts are certainly important factors and compensatory for innovation process.
    Keywords: Geography and Innovation; Patents; Knowledge Production Function.
    JEL: O31 R12 R15
    Date: 2014–11
  5. By: Hottenrott, Hanna; Lopes-Bento, Cindy; Veugelers, Reinhilde
    Abstract: This study investigates the effects of an R&D subsidy scheme on participating firms' net R&D investment. Making use of a specific policy design in Belgium that explicitly distinguishes between research and development grants, we estimate direct and cross-scheme effects on research versus development intensities in recipients firms. We find positive direct effects from research (development) subsidies on net research (development) spending. This direct effect is larger for research grants than for development grants. We also find cross-scheme effects that may arise due to complementarity between research and development activities. Finally, we find that the magnitude of the treatment effects depends on firm size and age and that there is a minimum effective grant size, especially for research projects. The results support the view that public subsidies induce higher additional investment particularly in research where market failures are larger, even when the subsidies are targeting development.
    Keywords: R&D,Complementarity,Research Subsidies,Development Subsidies,Innovation Policy
    JEL: H23 O31 O38
    Date: 2014
  6. By: Thanh Le (University of Queensland); Cuong Le Van (Centre d'Economie de la Sorbonne - Paris School of Economics, IPAG and VCREME)
    Abstract: We set up a theoretical framework to discuss the impact of trade liberalization and R&D policies on domestic exporting firms' incentive to innovate and social welfare. In this framework, exporting firms invest in R&D to reduce their production costs and, in return, receive R&D subsidies from the government. While firms target at maximizing their profits, the government aims to maximize the social welfare. We consider different settings of firm competition to explore their strategic behaviors as well as the government's strategic behavior at the policy stage. We find that trade liberalization in the foreign market always increases firms' output sales and social welfare and, in most cases, leads to higher R&D investments and productivity at firms as well as industry level. When firms are independent monopolies in the overseas market, it is optimal for the government not to provide any R&D subsidy. When goods are close substitutes, the social optimum can be achieved as a Nash equilibrium by applying an optimal R&D tax. Trade liberalization induces a higher R&D tax rate to be levied on firms. When firms also conduct business in the home market, it is always optimal for the government to provide firms with a financial support to their R&D activity. While this R&D subsidy is decreasing in the trade cost when firms are independent monopolies, its monotonicity in the trade costs is determined by the convexity of the R&D cost function when firms produce close substitutes.
    Keywords: Trade, R&D, subsidies, welfare, process innovation.
    JEL: F12 F13 F15 O31
    Date: 2014–10
  7. By: Eckert, Andrew (University of Alberta, Department of Economics); Langinier, Corinne (University of Alberta, Department of Economics)
    Abstract: The last several decades have seen increases in patenting activity worldwide, as well as growing issues related to patent quality. In response to these quality issues a recent patent literature has emerged, that investigates the behavior and incentives of patent examiners, applicants, and third parties. In this paper, we provide an overview of patent procedures, patent systems and a survey of the new economic literature on patent systems. Both theoretical and empirical papers are considered. Policy implications coming from this literature are presented.
    Keywords: patents; patent examination; patent systems; innovation; incentives
    JEL: K40 O31
    Date: 2014–09–01
  8. By: Lee, Neil; Rodriguez-Pose, Andres
    Abstract: Creative cities are seen as important sites for the generation of new ideas, products and processes. Yet, beyond case studies of a few high-profile cities, there is little empirical evidence on the link between local creative industries concentration and innovation. This paper addresses this gap with an analysis of around 1,300 UK SMEs. The results suggest that firms in local economies with high shares of creative industries employment are significantly more likely to introduce entirely new products and processes than firms elsewhere, but not innovations which are simply new to the firm. This effect is not exclusive to creative industries firms and seems to be largely due to firms in medium sized, rather than large, cities. The results imply that creative cities may have functional specialisations in new content creation and so firms are more innovative in them.
    Keywords: cities; creative cities; creative industries; creativity; innovation
    JEL: O31 O38 R11 R58
    Date: 2014–11
  9. By: Igone Porto; Jose Ramón Otegi
    Abstract: A review of the types of Innovation System identified in the literature points to different models. Besides the very well-known National, Regional, Local, sectorial, and technological innovation systems, combinations of the previous can be identified, proposing sub-models such as National Open Innovation Systems, Regional Open Innovation System, as well as Regional Sectorial Innovation System. Innovation systems are generally formed by 3 subsystems: Productive, Knowledge and Institutional. The interaction among the actors embedded in these subsystems fosters the development of cooperative and innovative attitudes. The literature settles differences between innovation systems disposing, in situ, policy making players or those being supported by collaborations with supra-territorial institutions. In this case, institutional subsystems are viewed as common regional values and culture promoters and diffusers. Another point is the openness of the innovation systems. Some authors consider this is already included in the IS concept while others reinforce the idea of the need of aperture. The previously mentioned types of Innovation System help explain the performance of different kind of regions. But, what happens in micro-regions that require sectorial, market, technological and geographical openness? What happens if the analyzed territory is sectorially specialized but does not have final clients, universities, research centers or policy makers? Would in that case be possible to consider an innovation system in the region? In order to contrast the ROSIS ?Regional Open Sectorial Innovation System-, a qualitative interview is performed with inner players of a micro-region (productive firms, knowledge actors and socio-political institutions). The found openness is not only productive, but also technological, sectorial and market-oriented one. Apart from inner players, external ones are also interviewed (regional policy researchers, policy makers, etc.) to academically validate the ROSIS model. Combining external and internal views of the region, the existence of the ROSIS can be analyzed from a policy sight. The scope of this research is the conceptualization and modeling of the ROSIS. This proposed Innovation System subtype is tested in a county located in the Basque Country (Spain) which counts with a strong productive specialization in the metal industry. The result of the analysis is the modeling of a multilevel IS considering the productive, sectorial, market, and technological openness to outside players, but also inner openness cooperation with all the existing players of the region, in order to consider all the knowledge diffusion chances.
    Keywords: Innovation System; Sector; Opennes
    JEL: L14 O18 O31 O32 R58
    Date: 2014–11
  10. By: Massimo Florio (DEAS, Universita' di Milano); Julie Pellegrin (CSIL Centre for Industrial Studies); Emanuela Sirtori (CSIL Centre for Industrial Studies)
    Abstract: This paper discusses some conditions under which the Cohesion Policy of the European Union can effectively contribute to enhance R&I in Europe and the extent to which it offers a relevant framework for devising Research & Innovation policies at regional level overcoming possible tensions and maximising potentials for synergy. To do so, the paper mainly relies on an in-depth illustrative case study of an Italian Southern region, Apulia. The paper describes the regional innovation system put in place by the Apulia Region and analyses the value added that can be attributed to such a system as far as innovation and economic development promotion are concerned; on this basis, findings from the case study are generalised in a set of lessons learned with hopefully more general relevance: these are discussed in Section 4.
    Keywords: Research intensive clusters; regional innovation systems; mechatronics
    JEL: L26 L62 R58
    Date: 2014–11–07
  11. By: Keith McLeod (Ministry of Business, Innovation and Employment); Richard Fabling (Motu Economic and Public Policy Research); David C. Maré (Motu Economic and Public Policy Research)
    Abstract: Poor productivity performance has been identified as a significant issue for New Zealand, and innovation is seen as a key mechanism for improving productivity growth. Understanding the drivers of firm innovation therefore represents an important step towards improving New Zealand’s economic performance. In this paper, we combine firm-level innovation data with worker characteristics to examine links between innovation and the presence of new arrivals – both immigrants and returning New Zealanders – in the firm’s workforce. Across a range of measures we find positive relationships between firm-level innovation and the share of new arrivals. These relationships weaken once we account for variation in firm characteristics (firm size, industry, R&D expenditure) and other worker characteristics (including the share of new and/or high skilled workers). Within new arrivals, innovation outcomes are most strongly associated with high skilled workers, though magnitudes vary depending on whether workers are returning New Zealanders or immigrants. Firms with a higher share of high skilled recent migrants were more likely to report introducing new marketing methods, new goods and services, or goods and services new to New Zealand. Firms with a higher share of high skilled returning New Zealanders were more likely to report introducing new organisational and managerial practices, and (as with migrants) goods and services new to New Zealand.
    Keywords: Innovation, workforce composition, immigrants, returning New Zealanders
    JEL: O31 J24 J61
    Date: 2014–11
  12. By: INUI Tomohiko; NAKAMURO Makiko; EDAMURA Kazuma; OZAWA Junko
    Abstract: This paper empirically examines the impact of board diversity on firms' innovative activity, taking advantage of the unique firm-level dataset in the period 2000-2011 in Japan. We constructed measurements of the degree of board diversity by using various characteristics of board members such as gender, age, tenure, and education, and found no significant impacts on firm innovative activity after controlling for the firms' fixed effects. However, when we restricted the sample to a group of firms with a high foreign ownership ratio or globalized firms, we found the presence of female board members is positively associated with promoting firms' innovative activity as measured by research and development (R&D) intensity. Our finding suggests that board diversity is not associated with the innovation across firms in general, but if a firm has already accumulated the management skills to handle the diversified voices and opinions from board members, this helps it to become more innovative.
    Date: 2014–12
  13. By: Marta Zaleska; Zbigniew Mogi£A; Joanna Knap
    Abstract: The economic crisis and the declining competitiveness of Europe, led to the orientation of cohesion policy for smart growth based on knowledge and innovation. Poland and its regions are in a specific socio-economical position characterized by a low share of higher value-added products and high technology-intensive ones in total export. They still need to bridge the gap towards the more developed EU countries and regions by shaping their competitive advantage. The only way to develop and maintain a competitive advantage is to trigger knowledge- and innovation-based entrepreneurship. Cohesion policy funds open up great opportunities for innovation. Nowadays, when the programming period 2007 - 2013 came to an end, it is increasingly important to assess effectiveness of the EU intervention in the context of innovation. The main aim of this study is to present the methodology that allows to assess the role of the EU operational programs in determining the long-term development based on pro-innovative business sector. To present methodology clearly, it will be presented on the example of the Innovative Economy Operational Programme 2007 - 2013 (IE OP) for Lower Silesia region. The first stage of the study will contain a review of literature and a proposition of typology of innovations in the context of their impact on the long-term development. The detailed analysis of more than 100 projects under the IE OP in Lower Silesia will be done to assess effectiveness of the implementation of co-financed research & development projects. The aim of this stage is to deepen the knowledge about the positive and negative factors affecting the implementation of the results of R&D in practice. On the base of the typology and results from previous stages, projects will be classified to created categories of innovation (e.g. imitative, product-oriented, process-oriented etc.). The results will verify whether in the analyzed projects dominates imitative type of innovation, which is typical of regions that are still shortening the distance towards the centers of socio-economic development. This, however, can lead to an "average income trap" that does not guarantee non-cost competitiveness. The results of the study may be used in future analysis as a contribution to the macroeconomic quantitative studies of the cohesion policy impact.
    Keywords: regional development; innovation; cohesion policy
    Date: 2014–11
  14. By: Stephan Brunow; Valentina Nafts
    Abstract: Innovation is a key driver of technological progress and growth in a knowledge-based economy. There are various motives for individual firms to innovate: improving quality secures market leadership, introducing new products leads the firm into new markets, adopting new technologies could be seen as a catch-up strategy within an industry or an improvement of the firm's own products when the technology adopted is based on ideas from other industries. Firms can perform innovation activities in one or more of these areas or in none of them. We therefore raise the question of what types of firms tend to be more innovative, i.e. which firms innovate in more of these areas. For this purpose we employ firm-level survey data and combine it with administrative data from Germany's social security system. An ordered logit model is estimated using a variety of characteristics which describe the workforce employed and other firm-related variables, the regional environment where the firm is located, as well as industry and region fixed effects.
    Keywords: firm innovation; labor diversity; ordered logit; regional economic environment
    JEL: J O R
    Date: 2014–11
  15. By: Cockburn, Iain M; Lanjouw, Jean O; Schankerman, Mark
    Abstract: This paper studies how patent rights and price regulation affect how fast new drugs are launched in different countries, using newly constructed data on launches of 642 new drugs in 76 countries for the period 1983-2002, and information on the duration and content of patent and price control regimes. Price regulation strongly delays launch, while longer and more extensive patent protection accelerates it. Health policy institutions, and economic and demographic factors that make markets more profitable, also speed up diffusion. The effects are robust to using instruments to control for endogeneity of policy regimes. The results point to an important role for patents and other policy choices in driving the diffusion of new innovations.
    JEL: I15 I18 K19 L65 O31 O33 O34 O38
    Date: 2014–09
  16. By: Alessandra Perri (Dept. of Management, Università Ca' Foscari Venice); Vittoria Giada Scalera (Dept. of Management, Economics and Industrial Engineering, Politecnico di Milano); Ram Mudambi (Dept. of Strategia Management, Temple University)
    Abstract: This paper explores the integration of emerging countries into the global system of innovation, as a channel for their technological catch-up. Using data on the innovative activity in the Chinese pharmaceutical industry, we analyze the geographic dispersion of inventor networks linked to China, as a function of the characteristics of the innovative actors that coordinate their inventive work.
    Keywords: Emerging Countries, Technological Catch-Up, FDI
    JEL: M16
    Date: 2014–12
  17. By: Mario Tello (Departamento de Economía - Pontificia Universidad Católica del Perú)
    Abstract: Based upon a standard Crepon, Duguet and Mairesse (1998), CDM, model and data at firms’ level, this paper analyzes the interrelationship between firms’ science, technology and innovation (STI) activities and their labor productivity in Peru for the year 2004. The effects of some constraints (i.e., investment innovation risks, market structure distortions and financial constraints) on firms’ decision and amount of investment on STI (or STI investment intensity) are also estimated. Subject to data limitations, the analysis suggests that firms’ size is an important factor in their decision to invest upon STI activities. In the same way, firms’ market share is a key factor in the determination of the level of investment on STI. On the other hand, investment risks and financial restriction seem to affect negatively to firms decision and amount of investment on STI respectively. However, their statistical effects vary among the six ISIC branches considered. The effects of market structure or anticompetitive practices were not clear in sign and statistical significance. Regarding the factors that foster innovation outputs or outcomes (such as new products, processes, commercial and organizational innovations) firms STI investment intensity, their degree of cooperation (collaboration) with other entities and the endowment of STI infrastructure are important factors that promote innovation outputs. Finally, although capital-labor ratio and human capital were determinants factors of firms’ labor productivity the effects of innovation outputs on labor productivity were not statistically significant or robust. JEL Classification-JEL: L6, O31
    Keywords: Science, technology and innovation, labor productivity and technological innovation, CDM model.
    Date: 2014
  18. By: Maria Teresa Costa (Universitat de Barcelona & IEB); Nestor Duch-Brown (Universitat de Barcelona & IEB)
    Abstract: Relevant advances in the mitigation of environmental impact could be obtained by the appropriate diffusion of existing environmental technologies. In this paper, we look at the diffusion of knowledge related to environmental technologies developed within the oil and gas industry. To assess knowledge spillovers from oil and gas inventions as a measure of technology diffusion, we rely on forward patent citations methodology. Results show that there is a strong likelihood that the citing patent will be eventually linked to environmental technologies if the original oil and gas invention has already environmental uses. Moreover, both intra and intersectoral spillovers produce a "turnabout" effect, meaning that citing patents show the opposite quality level of the cited patent. Our results support the idea that more sector-specific environmental policies, with an emphasis on diffusion, would significantly improve the use of environmental technologies developed within the oil and gas industry.
    Keywords: Forward patent citations, petroleum industry, environmental and technology policies
    JEL: Q4 Q55 O31
    Date: 2014
  19. By: Zizi Goschin; Georgiana-Gloria Goschin
    Abstract: Innovation and competitiveness are important factors for promoting economic growth not only nationally, but regionally as well. In Romania, research, development and innovation could be among the factors that are accountable for the increasing regional disparities, as the territorial distribution of R&D resources is very unbalanced. Romania is currently trying to define a regional strategy for R&D, as well as appropriate policies and priorities for innovation at regional level. In this context we address the issue of the regional intensity of R&D as one of the main determinants of economic growth in Alba county (subregion NUTS 3) in Romania. The Alba subregion can be considered an obvious example of a successful economic transformation since its GDP per capita increased more than 2 times in 10 years, based on a high rate of economic growth. We have analysed the regional intensity of R&D, measured as the share of total research and development expenditures in regional GDP, and have developed an economic growth model that aimed to capture the influence of R&D intensity alongside labour productivity, employment rate, human capital, the share of manufacturing in total economic activity, the extent of private entrepreneurship, and a dummy variable for economic crisis. The results point to a highly significant impact of research and development intensity on the long-run economic development of Alba county, as measured by GDP per capita. This positive effect of R&D on the economic performance in Alba county can be largely attributed to the creation and modernization of the business support infrastructure aimed at developing industrial parks, business incubators, industrial and scientific clusters, technological and logistic platforms, centers for research and transfer of technology, etc. These structures are designed to support business development in areas affected by industrial restructuring, but also economic activities in other areas with development potential in the county, providing favorable conditions for productive SME development, which can further contribute to economic development and job creation in both the underdeveloped and the rising areas in this subregion.
    Keywords: economic growth; regional regeneration; Alba county; Romania
    JEL: R11 R58
    Date: 2014–11
  20. By: Voeten, J. (Tilburg University, School of Economics and Management); Naudé, Wim
    Abstract: Innovation has been acknowledged as contributing to development, in particularly inclusive innovations that involve and benefit poorer groups in developing countries. However, such innovation may have negative externalities. Most often external regulation is required to reduce these effects. However, it is often not enough, and in many developing countries the required institutional context is not present to enable external regulation. Hence a case may be made for internal regulation of inclusive innovation. Helping to fill the gap in our knowledge on internal regulation of innovation externalities in developing countries, we explore four cases of innovation in informally-organised small producers’ clusters Vietnam. From this we propose a model of internal regulation as a societal process.
    Date: 2014
  21. By: Mirko Titze; Matthias Brachert
    Abstract: The EU Framework Programme (FP) belongs to the most important instruments promoting transnational collaborative R&D projects in Europe. Its main objective is to initiate cross-border complementarities in order to exploit knowledge resources and to conduct large scale research. Within the EU FPs the applicants are free to choose partners from all over Europe. The key question of our paper is: Which determinants affect the emergence of intra- and interregional collaborations within EU Framework Programmes? One might assume that geographical factors do not matter since trade barriers have been eliminated in the Single European Market. Though, there is a controversial debate on the importance of geographical proximity for the exchange of knowledge. Our paper relies on two theoretical concepts. First, we apply the global cluster networks conception developed by Bathelt and Li (2013). Within this concept it is argued that clustered organizations are more likely to set up collaborative R&D efforts with other similar clustered organizations to keep up with wider industry developments. Conversely, non-cluster organizations are less likely to get integrated cluster destinations. Second, we tie in with the proximity debate discussed in Boschma (2005). According to this concept geographical proximity addresses only one facet. Beyond physical distance other forms of proximity are existent such as social, cognitive, organisational and institutional proximity. It is argued that physical distance is neither a necessary nor a sufficient condition for interactive learning processes. Though, it may facilitate the other dimensions of proximity. In line with these strands of research we investigate the determinants of the number of cross-region collaborations within EU FPs. The analysis is focused on regional level (NUTS 2). Moreover, we differentiate between two technology fields, biotechnology and aerospace. In doing so, we are capable to capture technology specific characteristics. We apply a spatial interaction modelling framework that bases on a gravity type (Scherngell and Barber 2009). The empirical analysis is carried out using a negative binomial specification. We found evidence that geographical factors still matter ? but technological proximity seems to be more importantly. Moreover, we prove that the mere size in terms of employment and establishments is not necessarily required to establish cross-region collaborations. Also small actors have been chosen as partners in collaborative R&D networks across Europe.
    JEL: D85 L14 R12 R15
    Date: 2014–11
  22. By: Paul David (Stanford University); Adriaan van Zon (United Nations University)
    Abstract: This paper analyzes the requirements for a social welfare-optimized transition path toward a carbon-free economy, focusing particularly on the deployment of low-carbon technologies, and the roles of engineering upgrading of extant facilities, and directed R&D to enhancing their productivity. The goal in each case is to achieve timely supply-side transformations in the global production regime that will avert catastrophic climate instability, and do so in a manner that minimizes the social welfare costs of stabilizing the level of the atmospheric concentration of greenhouse gases (GHG). This “planning-model” approach departs from conventional IAM exercises by dispensing with the need to make (generally dubious) assumptions about the macro-level consequences of behaviors of economic and political actors in response to market incentives and specific public policy instruments, such as a carbon tax. It shifts attention instead to the need for empirical research on critical technical parameters, and problems of inter-temporal coordination of investment and capacity utilization that will be required to achieve a timely, welfare-optimizing transition. A suite of heuristic integrated models is described, in which global macroeconomic growth is constrained by geophysical system with climate feedbacks, including extreme weather damages from global warming driven by greenhouse gas emissions, and the threshold level GHG concentration beyond which the climate system will be “tipped into” catastrophic runaway warming. A variety of technological options are identified, each comprising an array of specific techniques that share a distinctive instrumental role in controlling the concentration level of atmospheric CO2. The development of low-carbon technologies through investment in R&D, and their deployment embodied in new physical capital formation, is explicitly modeled; as is the implementation of known engineering techniques to “upgrade” existing fossil-fueled production facilities. The social-welfare efficient exercise of the available technological options is shown to involve sequencing different investment and production activities in separate temporal “phases” that together form a transition path to a sustainable low-carbon economy— one in which gross CO2-emissions do not exceed the Earth’s “natural” abatement capacity. Parametric variations of the “tipping point” constraint in these models will permit exploration of the corresponding modification in the required sequencing and durations of investment and production in the phases that form the optimal transition path. The preliminary solutions (using mufti-phase optimal control methods) expose important dynamic complementarities among technological options that are often presented as substitutes by current climate policy discussions.
    Keywords: global warming, tipping points, catastrophic climate instability, technology fix options, R&D investments, capital-embodied innovations, optimal sequencing, IAM and DIRAM policy design approaches, multi-phase optimal control, sustainable endogenous growth
    JEL: Q54 Q55 O31 O32 O33
    Date: 2014–08
  23. By: Giulio Guarini (University of Tuscia, Viterbo, Italy); Giuseppe Garofalo (University of Tuscia, Viterbo, Italy); Alessandro Federici (ENEA, Italy)
    Abstract: The Europe 2020 Strategy has been built on three pillars: smart, sustainable and inclusive growth. The aim of the paper is to provide, thanks to Dynamic Panel data models, an econometric analysis of the potential cumulative circle among the abovementioned three pillars, with a specific focus on how labour productivity and environmental intensity interact with each other, and how they may help improving employment. With reference to the effect of sustainable factors on smart factors, main results of this paper confirm the 'dual externality principle': eco-innovations may both provide R&D spillovers and reduce environmental negative externalities; depending on the Porter’s hypothesis, environmental regulations may stimulate eco-innovation in order to reduce regulation costs. Furthermore, an increase of energy intensity tends to stimulate cost-saving innovations. Concerning the effect of smart factors on sustainable factors, the 'pollution haven hypothesis' is confirmed: trade openness increases pollution because of more relaxed environmental regulation, delocalization and specialization. Finally, the positive impact of smart and sustainability factors on employment depends on the complementarity between the first two pillars. Europe 2020 goals are essential in order to overcome the current economic, social, and ecological crisis: this paper highlights how this implies to go beyond the widely adopted 'austerity policy framework' and to implement some proposals able to generate, stimulate and sustain the abovementioned cumulative circle. Main political points are: the proactive role of public institutions, to avoid innovation market failures and to generate an 'innovation multiplier' starting from public investments; the territorial perspective of strategy; the coordination among macroeconomic policies on the one hand, and industrial, innovation, environmental, and trade policies on the other.
    Keywords: inclusion, innovation, sustainability, Europe 2020 Strategy
    JEL: O3 O4 Q5
    Date: 2014–12

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