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on Innovation |
| By: | Guimón , José (Department of Development Economics, Universidad Autónoma de Madrid); Chaminade , Cristina (CIRCLE, Lund University); Maggi , Claudio (Gerencia de Desarrollo Competitivo, CORFO, Santiago, Chile) |
| Abstract: | Over the last decade we have witnessed an unprecedented growth in the number of cross-border R&D investments towards developing countries. Large emerging economies like China or India have become the first destination of R&D-related investments in the world. Latin America, however, has played a rather marginal role as recipient of R&D-related FDI – barely 3.7% of the world total between 2003 and 2013. In an effort to revert this trend, several countries in the region have launched new policy programs and incentives to enhance their attractiveness for R&D-related FDI. However, it remains uncertain whether public incentives can compensate for other locational disadvantages that characterize Latin American innovation systems. The case of Chile provides an interesting empirical setting to explore these issues, because since the early 2000s its government is actively promoting R&D-related FDI through a new policy mix. This policy mix encompasses various grants and tax incentives, targeting not only multinational corporations but also foreign start-ups, universities and public research institutes. Rather than limiting the scope of our analysis to individual policy instruments, we also consider the complementarities and synergies among them. We emphasize that for national innovation systems to benefit from R&D-related FDI it is important to ensure that appropriate linkages are established with local actors that hold absorptive capacities. Equally important for a small emerging economy like Chile is to prioritize R&D-related FDI in strategic technology areas where the country can realistically attain critical mass to compete globally. |
| Keywords: | FDI; technology; R&D; innovation policy; development; globalization |
| JEL: | E61 F21 O38 |
| Date: | 2015–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_048&r=ino |
| By: | Freshwater, David; Wojan, Timothy J. |
| Abstract: | Innovation is widely recognized as a key driver of economic growth, but innovation is now mainly measured by patent statistics and seen as reflecting earlier investments in formal innovation systems that produce new products an new technologies. A consequence of this approach to describing the innovation process is that there is little role for entrepreneurs and in particular little chance of innovation taking place in rural regions. Yet prior to the 20th century most innovation came from individual entrepreneurs and many innovations originated in rural regions. In particular one form of innovation - user-innovation, where individuals or single firms when confronted with a significant problem that has no acceptable existing solution create their own innovation, is particularly relevant to rural regions. While most rural innovations serve local or niche markets there are examples of major rural innovations that have had disruptive national or global impacts. Preliminary results from the new USDA Rural Establishment Innovation Survey confirm that user innovation is an important aspect of many rural entrepreneurs and an important aspect of firm competiveness. |
| Keywords: | rural innovation, rural development, entrepreneurship, innovation models, regional growth, Community/Rural/Urban Development, O31, R58, D21, N10, |
| Date: | 2014–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ukysps:229301&r=ino |
| By: | Ullberg, Eskil (The Ratio Institute and george Mason University) |
| Abstract: | This article examines coordination between inventors and innovators through prices in a market for contracts on patented technology, in a controlled laboratory experiment. Typically, a hierarchical approach is used to analyze such coordination, new technology being exogenous, and risk managed in separate markets. Price signals and search patterns are compared for three institutional mechanisms and two levels of patent validity in a 3 x 2 experimental design. “Willingness to search” in a technology map of 9 “technology areas”, each with private and uncertain values for agents, are used to characterize and differentiate institutional behavior with respect to investment decisions in new technology. The results indicate that coordination and that the willingness to search out the most valuable technology differs sharply between the mechanisms; low patent validity also results in poor coordination. Policy implications suggest facilitating a market in tradable contracts on patents is needed. This may entail lowering risk in using patent “assets” (access to quality patents and enforcements for SMEs) and new forms of legal associations for IP intensive firms. |
| Keywords: | patent markets; coordination; invention; innovation; patent licensing; experimental economics; intellectual property rights assets |
| JEL: | B00 C92 D83 O00 O30 |
| Date: | 2015–11–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0260&r=ino |
| By: | Husmann, Christine; von Braun, Joachim; Badiane, Ousmane; Akinbamijo, Yemi; Abiodun, Fatunbi Oluwole; Virchow, Detlef |
| Abstract: | While in the past, increased use of inputs and expansion of agricultural land accounted for a good part of agricultural growth in Africa, improvements in productivity will need to be a major driver of growth in the future. Thus, agricultural innovations are needed to sustainably increase productivity, i.e. output per unit of all inputs, while maintaining environmental quality and resources. Such innovations require enhanced investments in research and development. This study identifies potentials in agriculture and food systems in Africa for enhanced food security. For maximum impact, the Special Initiative “One World – No Hunger” of BMZ needs to take note of the whole African landscape of actions in agriculture and food security. Therefor this study provides a detailed review of related ongoing and recent initiatives, in order to help identify in what ways investments under the “One World – No Hunger“ Special Initiative from a broad strategic perspective might best connect and serve in coherent and complementary ways to increase food and nutrition security and sustainable agricultural productivity growth. Innovations in the agricultural sector are key to ensure food security and achieve the right to food. Investments in the agricultural sector are crucial not only to increase food production but also because the returns on investments in terms of poverty reduction effects are often highest in in this sector. Furthermore, food insecurity and violent conflicts are inextricably interlinked with food insecurity being both a driver and a consequence of violent conflicts and related refugee flows. African countries have recently made major commitments to invest in agriculture. The Comprehensive Africa Agriculture Development Programme (CAADP), that was initiated in 2003 and has been reinforced by the Malabo Declaration in 2014, is now the reference point and measure of commitment in Africa. With CAADP, African countries committed to spend 10% of their total public expenditures on agriculture to achieve an annual agricultural growth rate of 6%. Other African and international initiatives, including new partnerships between African governments, donors and the private sector like the New Alliance for Food Security and Nutrition or Feed the Future, have since been launched to support the CAADP process. Investment opportunities differ across Africa. In view of the above mentioned goals, it is suggested here that development investments by Germany target countries which reveal potentials indicated by 1. having a track record of political commitment to foster sustainable agricultural growth, as indicated by performance under CAADP, and 2. showing actual progress in sustainable agricultural productivity driven by related innovations, as indicated by comprehensive productivity measurement and innovation actions on the ground, and 3. prioritizing actions for hunger and malnutrition reduction and showing progress (for instance measured by the Global Hunger Index), but where agricultural and rural development and nutrition interventions are likely to make a significant difference, as indicated by public policy and room for civil society actions. The records and potentials of 42 African countries are identified accordingly, using comprehensive assessments of agronomic, economic and governance criteria that can be transparently tracked. |
| Keywords: | Agriculture, Innovations, Food and Nutrition Security, Agricultural Policy, Sustainable Growth, Crop Production/Industries, Environmental Economics and Policy, International Development, Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ubonwp:228855&r=ino |
| By: | Reinhilde Veugelers |
| Abstract: | Highlights The European Union has prioritised the pursuit of innovation based growth and targeting of resources to promote research and development, but performance on innovation remains weak. With the lack of results comes fatigue, waning interest and mounting criticism about policy. Should the EU abandon its ambition to become the most innovative region in the world? We examine EU member state research and innovation policies. We assess whether the deployment of innovation policy instruments in EU countries matches their innovation capacity performance relative to other EU countries. We find a relative homogeneity of policy mixes in EU countries, despite the fairly wide and stable differences in their innovation capacities. Our analysis therefore provides a rationale for a more comprehensive review of innovation policy mixes to assess their adequacy in addressing country specific innovation challenges. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:11543&r=ino |
| By: | Engel, Dirk; Rothgang, Michael; Eckl, Verena |
| Abstract: | The paper analyses how context and time dependent factors determine the impulse of R&D subsidies on firm behavior with respect to private R&D expenditures. Based on data from the German R&D survey, we combine propensity-score matching with a difference-in-difference-estimator in order to measure the causal influence of public direct R&D project funding on firm behavior. Our results indicate that (i) repeated participation in R&D projects on average leads to a higher increase in R&D expenditures than one-time funding; (ii) the aggregate effect of R&D funding on R&D expenditures of business firms is somewhat higher for business and business collaboration projects than for science and business collaboration projects; (iii) R&D expenditures of business firms that cooperate with science show a higher share of external R&D spending. Results of one particular cluster programme indicate that at least the short-term development of R&D does not so much depend on which programme direct R&D project funding is applied to. |
| Keywords: | R&D,public subsidies,collaboration,policy evaluation |
| JEL: | C14 C25 H50 O38 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:587&r=ino |
| By: | Peters, Bettina; Roberts, Mark J.; Vuong, Van Anh |
| Abstract: | This article investigates how a firm's financial strength affcts its dynamic decision to invest in R&D. We estimate a dynamic model of R&D choice using data for German firms in high-tech manufacturing industries. The model incorporates a measure of the firm's financial strength, derived from its credit rating, which is shown to lead to substantial differences in estimates of the costs and expected long-run benefits from R&D investment. Financially strong firms have a higher probability of generating innovations from their R&D investment, and the innovations have a larger impact on productivity and profits. Averaging across all firms, the long run benefit of investing in R&D equals 6.6 percent of firm value. It ranges from 11.6 percent for firms in a strong financial position to 2.3 percent for firms in a weaker financial position. |
| Keywords: | R&D choice,Financial strength,Innovation,Productivity,Dynamic structural model |
| JEL: | O31 O32 G30 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:15083&r=ino |
| By: | Zhou, Wen (School of Computer Engineering and Science); Koptyug, Nikita (Research Institute of Industrial Economics (IFN)); Ye, Shutao (School of Computer Engineering and Science); Jia, Yifan (School of Computer Engineering and Science); Lu, Xiaolong (School of Computer Engineering and Science) |
| Abstract: | As computer science and complex network theory develop, non-cooperative games and their formation and application on complex networks have been important research topics. In the inter-firm innovation network, it is a typical game behavior for firms to invest in their alliance partners. Accounting for the possibility that firms can be resource constrained, this paper analyzes a coordination game using the Nash bargaining solution as allocation rules between firms in an inter-firm innovation network. We build an extended inter-firm n-player game based on nonidealized conditions, describe four investment strategies and simulate the strategies on an inter-firm innovation network in order to compare their performance. By analyzing the results of our experiments, we find that our proposed greedy strategy is the best-performing in most situations. We hope this study provides a theoretical insight into how firms make investment decisions. |
| Keywords: | Complex Networks; Game Theory; Innovation; Innovation Network; Nash Equilibrium |
| JEL: | C72 C81 C82 D81 L14 |
| Date: | 2015–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1097&r=ino |
| By: | Corinne Langinier (Department of Economics, University of Alberta); Stephanie Lluis (Department of Economics, University of Waterloo) |
| Abstract: | Using data from patent examiners at the U.S. Patent and Trademark Office, we ask whether, and if so how, examiners’ career outcomes relate to aspects of the patent review process. Exploiting longitudinal information about all the patents granted by a group of examiners between 1976 and 2006 and their yearly mobility outcomes (departure and promotion) between 1992 and 2006, we find consistent evidence from static, dynamic and duration models of the importance of patent characteristics, granting experience in specific technological fields, repeated interactions with the same inventor and self-citations in predicting an examiner’s departure or promotion. |
| JEL: | J60 O34 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:wat:wpaper:1506&r=ino |
| By: | Filippo Belloc |
| Abstract: | We analyse how countries' innovation outcomes are affected by national legislations of worker participation to corporate governance. We develop a model of employee representation laws (ERL) and innovation in the presence of incomplete labour contracts and predict heterogeneous ERL effects across different systems of dismissal regulation. We then perform a panel regression analysis, exploiting 2-digit panel data for 21 manufacturing sectors of USA, UK, India, France and Germany, over the 1977-2005 period. We find that ERL effects on aggregate innovation output are positive, statistically significant and higher in magnitude where national labour laws impose significant ring costs to the firm with respect to institutional settings in which ring costs are low or absent. These results are robust to possible technology selection dynamics, endogeneity and institutional changes in the legal system of patent protection. We also estimate ERL effects on innovation conditional on ring costs at an industry level and show that the impact of ERL is relatively larger in those sectors where the human capital contribution to production is higher. Our results have relevant implications for the optimal design of employee representation legislations. |
| Keywords: | employee representation law, innovation, panel data |
| JEL: | K31 O31 P51 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:719&r=ino |
| By: | Link, Albert (University of North Carolina at Greensboro, Department of Economics); Swann, Christopher (University of North Carolina at Greensboro, Department of Economics) |
| Abstract: | It is well documented that knowledge based capital (KBC) is a driver of economic growth and development and that knowledge acquired through scientific research and development (R&D) is one important component of KBC. In this paper we examine the importance of R&D to a firm for exploring new business opportunities using information from the AEGIS database. We find that, among other things, human capital measured in terms of the educational background of the firm’s founders is a positive and statistically significant covariate with the importance of R&D. We conclude the paper with public policy recommendations for enhancing the educational component of the human capital resource base of firms. |
| Keywords: | entrepreneurship; R&D; knowledge based capital; human capital; technology; innovation; AEGIS |
| JEL: | L25 L26 O31 O33 |
| Date: | 2015–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:ris:uncgec:2015_008&r=ino |
| By: | Garry A. Gabison (European Commission – JRC - IPTS) |
| Abstract: | This report looks at venture capital (VC) funds, their characteristics, and functioning. It specifically focuses on the relationship between VCs and innovation, investigating whether VC funds encourage innovative companies to innovate or whether they successfully predict which companies will innovate more. The report also focuses on the selection process at micro-level. VC funds invest in young and innovative companies and decide where to invest based on imperfect information and signals. The ICT industry has a number of young innovative companies and unsurprisingly VC funds have concentrated their efforts on the ICT industry. In 2013, about 25% of invested funds went into ICT companies even though ICT companies represent less than 6% of all companies. The report then steps back to look at the macro-level. Once they have invested, VC funds use stage financing, monitoring, and exit incentives to re-align their incentives with those of the company receiving the funds. Since they rely on monitoring, VC funds usually prefer to invest in local companies that they can visit regularly. This issue of local investment is seen as a hindrance and EU policymakers have tried to remedy it passing a regulation to facilitate the cross-border funding. The EU has also partly funded the European Investment Fund to further encourage investment and cross-border investment. |
| Keywords: | venture capital fund, innovation, ICT |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc98783&r=ino |
| By: | Ullberg, Eskil (The Ratio Institute and George Mason University) |
| Abstract: | Performance and behavioural properties of markets in patents are studied using a contract with a two-part tariff (fixed fee and royalty) on patented technology with limited validity and random values, in an economic experiment. Performance doubles when demand side bidding is introduced for both tariffs, resulting in gains from trade, compared with supply side take-it-or-leave-it offers. This departs from the hierarchical view of (Arrow, 1962), where the invention and innovation takes place in the same firm, eliminating any gains from trade in the analysis. An informal theory is proposed, based on insurance of market access, and tested. The sustained prices support the hypothesis that fixed fee = blocking value, thus supports rational expectations according to Muth under conditions of demand-side bidding in both tariffs. Understanding nature then drives demand for science (North, 1981). What made productivity grow in Europe may therefore have been the patent system by increasing growth in economically useful technology through a producer market. |
| Keywords: | patent markets; two-part tariff contract; patent licensing; insurance; experimental economics; intellectual property rights assets |
| JEL: | B00 C92 L10 O00 O30 |
| Date: | 2015–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0261&r=ino |
| By: | Elisabetta Marinelli (European Commission – JRC - IPTS); Katharina Buesel (ZSI); Alexander Degelsegger (ZSI); Andrea Zenker (Fraunhofer ISI); Stephanie Daimer (Fraunhofer ISI); Mathieu Doussineau (European Commission – JRC - IPTS); Karel Haegeman (European Commission – JRC - IPTS) |
| Abstract: | The concept of the European Research Area, as originally defined, promoted increased co-ordination and cooperation among national research policies and programmes. Later on it was complemented by another ambitious objective, that of realising the fifth "freedom of movement" within Europe. Both objectives require the construction and implementation of effective instruments. This third edition of the ERA Fabric Map reflects on instruments in two steps. It first analyses the current main policy programmes and instruments and their historical development thus delving into the mechanisms that actually shape the research and innovation scene in Europe. It then adopts a prospective point of view and analyses the four scenarios developed by the VERA consortium from an instrument perspective. It highlights the policy programmes and instruments that need to be in place to sustain them, and compares them to those currently in place in Europe and the rest of the world. This third version of the ERA Fabric Map complements the first two editions by adding an instrument perspective and a forward-looking dimension. |
| Keywords: | European Research Area Scenarios ERA governance Instruments Foresight |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc98804&r=ino |
| By: | Martin Aarøe Christensen (European Commission – JRC - IPTS) |
| Abstract: | We present a multi-country, multi-sector dynamic general equilibrium model with ICT and R&D-driven endogenous growth. The model presented has been developed to study the economic effects of alternative ICT R&D funding policies in the European Union. It accommodates alternative policy instruments that could be used in an attempt to stimulate private ICT R&D expenditures, including general production grants, tax credit or subsidies targeted at specific inputs. The model is calibrated to data from four country blocs Germany, France, the Rest of the EU and the Rest of the World. |
| Keywords: | Economic Modelling, R&D, ICT, Endogenous Growth |
| JEL: | C68 O30 H20 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc97908&r=ino |
| By: | Trippl , Michaela (CIRCLE, Lund University); Grillitsch , Markus (CIRCLE, Lund University); Isaksen , Arne (Department of Working Life and Innovation, University of Agder, Norway); Sinozic , Tanja (Institute for Multi-Level Governance and Development, Vienna University of Economics and Business, Austria) |
| Abstract: | The past few years have seen an increasing popularity of cluster life cycle approaches. These models, however, suggest a rather deterministic view, are indifferent with respect to context and suffer from biological connotations. This chapter intends to go beyond the cluster life cycle models. We review the literature on industrial districts, innovative milieu and regional innovation systems and investigate how these alternative approaches contribute to the development of a more context-sensitive approach to cluster change. We argue that future research may benefit from developing theoretically relevant categorizations of different cluster types and from carrying out comparative empirical studies. |
| Keywords: | cluster evolution; cluster life cycle; regional industrial change; regional innovation systems |
| JEL: | O10 O30 R10 R50 |
| Date: | 2015–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_046&r=ino |
| By: | Takauchi, Kazuhiro |
| Abstract: | This study examines the effects of higher transport efficiency on cost-reducing R&D investment and welfare in a two-way duopoly trade model with an imperfectly competitive transport sector. We show that, corresponding to the degree of the R&D spillover, higher transport efficiency can affect investment in a U-shaped fashion. We also show that higher transport efficiency can reduce total output and consumer surplus. By comparing the two cases of firm-specific carriers and duopoly carriers, we demonstrate that total output in the case of duopoly carriers is lower than that in the case of firm-specific carriers if the spillover is sufficiently large. Higher transport efficiency and competition in the transport sector may harm consumers. |
| Keywords: | Transport efficiency; Imperfectly competitive transport sector; Cost-reducing R&D; R&D spillover |
| JEL: | F12 L13 |
| Date: | 2015–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:68479&r=ino |
| By: | YOSHIKAWA Hiroshi |
| Abstract: | Abstract in English is not available. |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rpdpjp:15017&r=ino |
| By: | G. Ardizzi; F. Crudu; C. Petraglia |
| Abstract: | This paper presents new evidence on the assessment of banks’ cost efficiency gains stemming from ICT adoption. With respect to the existing literature we introduce two novelties. First, a measure of banking operating costs is explained in terms of a commonly used measure of IT innovation (the relative diffusion of ATMs) and a new variable defined as automated payment transactions. Second, the results obtained via standard parametric estimation methods are compared with those obtained via nonparametric estimation techniques. Using an original dataset of Italian banks or banks operating in Italy observed in the period 2006-2010, we do not find clear cost efficiency enhancing effects due to ATMs diffusion. On the other hand, the diffusion of electronic payments shows a significant effect in terms of cost inefficiency reduction. |
| Keywords: | electronic payments, ATM, transaction technology, bank cost efficiency, nonparametric regression, cross-validation |
| JEL: | C14 C33 G2 L11 L8 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201517&r=ino |
| By: | Trippl , Michaela (CIRCLE, Lund University); Grillitsch , Markus (CIRCLE, Lund University); Isaksen , Arne (Department of Working Life and Innovation, University of Agder, Norway) |
| Abstract: | The role of exogenous sources of new path development has been underplayed in the literature on regional industrial change so far. The aim of this paper is to explore in a conceptual way under which conditions and in what ways non-local knowledge can lead to new path development in different regional innovation systems (RIS). We distinguish between organizationally thick and diversified, thick and specialized and thin RIS and argue that these types vary markedly in their needs for exogenous sources as well as in their capacities to attract and absorb knowledge generated elsewhere. Organisationally thick and diversified RIS have a lower need for exogenous sources but they exhibit strong capacities to attract and absorb non-local knowledge. In contrast, organisationally thick and specialised RIS and organisationally thin RIS have a higher need for exogenous sources but show a lower capacity to attract and absorb knowledge from elsewhere. However, a closer look reveals that these RIS types can increase their attractiveness for non-local knowledge and may benefit from its inflow if they strengthen their absorption capacity. We conclude that new regional industrial path development is less endogenous in nature than commonly thought, and that the attraction and absorption of non-local knowledge should be more included in conceptualisations of new path development. |
| Keywords: | new path development; regional industrial change; non-local knowledge; regional innovation systems; degree of organizational thickness; specialization; diversity |
| JEL: | O10 O19 O30 R10 |
| Date: | 2015–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_047&r=ino |
| By: | Martin Aarøe Christensen (European Commission – JRC - IPTS) |
| Abstract: | The report provides a quantitative analysis of the economic impacts of national public support to ICT R&D in the European Union, considering a number of policy scenarios covering different amounts of public spending, policy instruments and sources of financing. For this purpose we use a macroeconomic model with ICT and R&D driven endogenous growth. The model accommodates a range of policy instruments that may be used to stimulate R&D activity (ICT or non-ICT) in the economy, and it captures multiple channels through which R&D activity affects the economy. The policy scenarios are simulated with the model. The simulation exercise provides some preliminary evidence that an increase in public expenditure to support ICT R&D might have a significantly positive impact on ICT sector BERD as well as on economic growth and employment in the EU. It also shows that the strength and in some cases the sign of this impact can be influenced by policy instruments and financing source. Additional work is needed to gain further insights on the sensitivity of these results to the assumptions and parameter settings used in the model. |
| Keywords: | Economic Modelling, R&D, ICT, Endogenous Growth |
| JEL: | C68 O30 O52 H20 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc97907&r=ino |
| By: | Raouf Boucekkine (Aix-Marseille University (Aix-Marseille School of Economics), CNRS and EHESS); Natali Hritonenko (Prairie View A&M University, USA); Yuri Yatsenko (Houston Baptist University, USA) |
| Abstract: | We study the impact of technological progress on the level of employment in a vintage capital model where: i) capital and labor are gross complementary; ii) labor supply is endogenous and indivisible; iii) there is full employment, and iv) the rate of labor-saving technological progress is endogenous. We characterize the stationary distributions of vintage capital goods and the corresponding equilibrium values for employment and capital lifetime. It is shown that both variables are non-monotonic functions of technological progress indicators. Technological accelerations are found to increase employment provided innovations are not too radical. |
| Keywords: | Vintage capital, Technological progress, Employment, Compensation theory |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1550&r=ino |
| By: | Filippo Belloc; Eleonora laurenza; Maria Alessandra Rossi |
| Abstract: | The paper explores the question whether the relationship between corporate governance and innovation is affected by the extent to which the firm is exposed to agency problems and asset specificity issues. In particular, we argue that different combinations of asset specificity and agency costs are associated to firm age and sector of activity and predict heterogenous effects of ownership concentration on innovation across different types of firms. We use a unique dataset on about 35.000 Italian manufacturing corporations over the 2002-2007 period and run a hurdle model, distinguishing four sub-groups of firms on the basis of their age (greater or lower than 15 years) and of whether they belong to a high technology or low technology sector. We find that the effects of ownership concentration on innovation are coherent with the predictions of so-called "shareholder theory" when agency cost effects dominate over asset specificity effects and that they are coherent with the predictions of so-called "stakeholder theory" when asset specificity effects dominate over agency cost effects. These findings are robust to a number of identification issues, including the possible endogeneity of corporate ownership structures. Our results may allow to make sense of the contradictory findings of the literature on corporate governance and innovation, especially as regards the role played by ownership concentration, and may help policy-makers to define more effective type-specific initiatives to stimulate firm innovation. |
| Keywords: | corporate governance, innovation, Italian manufacturing sectors, hurdle models |
| JEL: | C30 G30 L60 O30 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:718&r=ino |
| By: | Martin Aarøe Christensen (European Commission – JRC - IPTS) |
| Abstract: | This report describes the first release of the macroeconomic model developed under the project Prospective Insights on R&D in ICT (PREDICT 2), a research project co-financed by the Directorate General for Communications Networks, Content and Technology and the JRC-IPTS. One of the objectives of PREDICT 2 is the development of a macroeconomic model which allows the economic analysis of scenarios related to ICT R&D funding policies in the European Union. This report provides a motivation for the chosen modelling approach, describes the model structure and the calibration of the model to a reference growth path. |
| Keywords: | Economic Modelling, R&D, ICT, Endogenous Growth |
| JEL: | C68 O30 H20 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc97902&r=ino |
| By: | Jan Witajewski-Baltvilks |
| Abstract: | The paper studies the dynamics of college wage premium across OECD countries. It reports that countries which experienced college wage premium growth higher than that of other countries also witnessed a higher growth of the skills supply ten years earlier. Regression results suggest that this pattern could not be explained by the theory of global Directed Technological Change, increase in trade or the fall of trade-unions. However, it can be explained with the model of endogenous technology choices: the growth of skilled workers motivates firms to pick more skill-biased production methods. I calibrate the model using the results of the dynamic panel regression. Endogenous technology choices can explain one third of the total increase in wage inequality in the OECD. One implication is that any policy that affects the supply of skilled workforce at the country level will have an impact on the skill-bias of equilibrium technology and wage inequality dynamics. |
| Keywords: | technological change: choices and consequences skills, labor productivity |
| JEL: | J24 O33 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:ibt:wpaper:wp152015&r=ino |
| By: | Guiso, Luigi; Pistaferri, Luigi; Schivardi, Fabiano |
| Abstract: | We document that individuals who grew up in areas with high density of firms are more likely, as adults, to become entrepreneurs, controlling for the density of firms in their current location. Conditional on becoming entrepreneurs, the same individuals are also more likely to be successful entrepreneurs, as measured by business income or firm productivity. Strikingly, firm density at entrepreneur’s young age is more important than current firm density for business performance. These results are not driven by better access to external finance or intergenerational occupation choices. They are instead consistent with entrepreneurial capabilities being at least partly learnable through social contacts. In keeping with this interpretation, we find that entrepreneurs who at the age of 18 lived in areas with a higher firm density tend to adopt better managerial practices (enhancing productivity) later in life. |
| Keywords: | entrepreneurship; learning; spillovers |
| JEL: | J24 M13 R11 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10997&r=ino |
| By: | Fredriksen, Lars (Aarhus university); Wennberg, Karl (Institute for Analytical Sociology (IAS) & Department of Management and Engineering Linköping University, Sweden and Ratio Institute); Balachandran, Chanchal (Linköping unievrsity) |
| Abstract: | Knowledge-based theories of entrepreneurship infer transfer of knowledge from the effect of labor mobility on entrepreneurial entry. Yet, simple selection or situational mechanisms that do not imply knowledge transfer may influence entrepreneurial entry in similar ways. We argue that the extent to which such alternative mechanisms operate, labor mobility predicts entry but not subsequent performance for entrepreneurs. Analyses of matched employee-employer data from Sweden suggest that high rates of geographical and industry mobility increase individuals’ likelihood of entrepreneurial entry but have no effects on their entrepreneurial performance, indicating that the relationship between labor mobility and entrepreneurial entry not necessarily implies knowledge transfer. |
| Keywords: | Entrepreneurship; Mobility; Knowledge |
| JEL: | J61 M13 O18 |
| Date: | 2015–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0266&r=ino |
| By: | José Ignacio Rivero (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | This paper measures the impact of incubation on new and innovative Uruguayan firms’performance. Technological innovation has a fundamental role in explaining economic growth and broader economic development. With this in mind, the fact that new and innovative firms face larger difficulties when trying to validate their innovations becomes a policy concern. One of the answers given to this problem is incubation, which attempts to place this particular sort of companies in a “secure” environment until they are able to survive on their own. The evaluation was restricted to firms housed at a particular incubator called Ingenio, which is one of the largest and oldest operating in Uruguay. It was carried out using a unique panel of data gathered from the incubator and through a survey of current and former incubatees and of rejected candidates. In order to control for potential correlation between the outcome and firms’ observed and unobserved traits a sharp regression discontinuity design was employed, exploiting the incubator’s selection process. Evidence showed timid support for the hypothesis that incubation has a positive impact on firms’ sales and employment, while no impact was detected on their exports. One of the possible explanations for the small impacts detected is that small sample size may have biased the estimates downwards. Therefore it can be affirmed that, at the very least, incubation did not hamper these companies’ performance. |
| Keywords: | incubation, sharp regression discontinuity, impact evaluation. |
| JEL: | M13 O2 O31 O32 O38 |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:0315&r=ino |
| By: | R. Brancati; E. Marrocu; M. Romagnoli; S. Usai |
| Abstract: | Are there any factors driving firms’ internationalization process other than productivity? By means of a firm-level dataset on manufacturing and production services sectors collected by MET, this paper investigates the export performance of enterprises in Italy in the aftermath of the recent economic crisis. Our results suggest that productivity is not the only (and most important) determinant in this matter. Innovation activity and learning processes are indeed pivotal in boosting enterprises to sell their products abroad and, to a certain extent, in backing their success on foreign markets. In particular, by estimating dynamic probability models as well as Tobit II-Heckman and two-part models, we provide evidence that firm’s ability to learn from its past export experiences lowers international trade informal barriers, while its ability to learn thanks to regional and local industry spillovers is important in terms of both extensive and intensive performances on foreign markets. |
| Keywords: | international trade, inter-regional trade, innovation, regional/industrial spillovers, dynamic binary models, Tobit II models, two-part models |
| JEL: | C23 C25 F14 O3 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201516&r=ino |
| By: | Kondor, Péter; Köszegi, Botond |
| Abstract: | We analyze the welfare properties of derivative securities that profit-maximizing issuers offer to investors who have inferior information and neglect the information content of the offer. To capture the markets for structured securities and exotic exchange-traded funds, we assume that issuers can choose both the underlying asset and the form of the security. An issuer's optimal security induces investors to bet on unlikely market movements, creating both excess risk taking and undersaving. Giving more information to the issuer leads it to choose an underlying asset on which its information is more extreme, exacerbating both effects and hence lowering social welfare. Furthermore, providing inferior and noisy additional information to investors also lowers welfare because the security is then written on an underlying asset about which the information is misleading. If the issuer can base its security on a combination of underlying assets, it optimally creates a "custom-designed" index to maximize its informational advantage and minimize risk, minimizing investor and social welfare. Restricting the set of underlying assets - a kind of standardization - increases welfare by preventing the issuer from systematically selling a security with extreme or misleading information. Once this policy is adopted, increasing investor information becomes beneficial. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbeoc:spii2015306&r=ino |