nep-ino New Economics Papers
on Innovation
Issue of 2016‒07‒23
33 papers chosen by
Uwe Cantner
University of Jena

  1. Firm Reputation and Employee Startups By Jan Zabojnik
  2. Isolation and Innovation – Two Contradictory Concepts? Explorative Findings from the German Laser Industry By Kudic, Muhamed; Ehrenfeld, Wilfried; Pusch, Toralf
  3. Where to Locate Innovative Activities in Global Value Chains: Does Co-location Matter? By Rene Belderbos; Leo Sleuwaegen; Dieter Somers; Koen De Backer
  4. Advertising, Innovation and Economic Growth By Pau Roldan; Laurent Cavenaile
  5. Technology and Innovation Policies for Small and Medium-Sized Enterprises in East Asia By Intarakumnerd, Patarapong; Goto, Akira
  6. Fashion, fads and the popularity of choices: micro-foundations for non-equilibrium consumer theory By Jean-Francois Mercure
  7. External search for exploration of future discontinuities and trends: Implications from the literature using co-citation and content analysis By Heuschneider, Sara; Herstatt, Cornelius
  8. Comparing persistence of product and process innovation: A discrete-time duration analysis of Innovation Spells By Córcoles, David; Triguero, Ángela; Cuerva, María Carmen
  9. RIO Country Report 2015: Sweden By Merle Jacob; Asa Lindholm Dahlstrand; Sprutacz Maren
  10. EU corporate R&D intensity gap: What has changed over the last decade? By Pietro Moncada-Paternò-Castello
  11. RIO Country Report 2015: Germany By Sofka Wolfgang; Sprutacz Maren
  12. Trade, Intellectual Property Rights, and the World Trade Organization By Kamal Saggi
  13. The Effect of attitude toward aging on ICT adoption: the Readiness of user By Ju-Chuan Wu; Chih-Jou Chen
  14. Economic issues of innovation clusters-based industrial policy : a critical overview By Iritié, B. G. Jean Jacques
  15. Creating Shared Value: Social Capital as a Source to Drive Next Wave of Innovation for Socioeconomic Revenues By Qadri, Mubashar; Mamoon, Dawood
  16. The role of innovation and agglomeration for employment growth in the environmental sector By Horbach, Jens; Janser, Markus
  17. Understanding Society Innovation Panel Wave 8: Results from Methodological Experiments By Creighton, Mathew; Dykema, Jennifer; Gaia, Alessandra; Cernat, Alexandru; Garbarski, Dana; Jamal, Amaney; Kaminska, Olena; Keusch, Florian; Lynn, Peter; Oberski, Daniel; Schaeffer, Nora Cate; Uhrig, S.C. Noah; Yan, Ting
  18. Support for Public Research Spin-offs by the Parent Organizations and the Speed of Commercialization By Slavtchev, Viktor; Göktepe-Hultén, Devrim
  19. Endogenous Sector-Biased Technological Change and Industrial Policy By Berthold Herrendorf
  20. OECD Taxonomy of Economic Activities Based on R&D Intensity By Fernando Galindo-Rueda; Fabien Verger
  21. Regulation, Red Tape and Location Choices of Top R&D Investors By Daria Ciriaci; Nicola Grassano; Antonio Vezzani
  22. Trade Competition, Technology and Labour Reallocation By Baziki, Selva B.; Ginja, Rita; Borota Milicevic, Teodora
  23. Applying Patent Intelligence to Explore the Technology Evolution By Yu-Hui Wang; Tzu-han Chow
  24. The Causal Impact of Human Capital on R&D and Productivity: Evidence from the United States By Veronica Mies; Matias Tapia; Ignacio Loeser
  25. Inclusive Insurance Sector: An Innovation business model for Microinsurance Delivery in Sri Lanka By Heenkenda, Shirantha
  26. Diversity in one dimension alongside greater similarity in others: Evidence from FP7 cooperative research teams By Alexander Coad; Sara Amoroso; Nicola Grassano
  27. Changing of the guard: Structural change and corporate science in the semiconductor industry By Pellens, Maikel; Della Malva, Antonio
  28. Monitoring and Assessment Framework for the European Innovation Partnership on Active and Healthy Ageing (MAFEIP) - Gap analysis By Christian Boehler; Fabienne Abadie
  29. Why does he get award? Comparison of innovative thinking points By Jen Chia Chang; Hsi Chi Hsiao; Su Chang Chen; Tien Li Chen; Pei Jou Chiu
  30. R&D investments fostering horizontal mergers By Petrakis, Emmanuel; Moreno, Diego; Manasakis, C.; Cabolis, C.
  31. Spinning the Industrial Revolution By Jane Humphries; Benjamin Schneider
  32. Coordinated Adoption of Social Innovations By Dominik Karos
  33. Technological progress and (un)employment development By Blien, Uwe; Ludewig, Oliver

  1. By: Jan Zabojnik (Queen's University)
    Abstract: This paper studies a repeated-game model in which firms can build a reputation for rewarding innovative employees. In any Pareto efficient equilibrium, low-value innovations get developed in established firms, while high-value innovations get developed in startups. The threshold level can be discontinuous, so otherwise similar firms may exhibit very different levels of innovation. The paper also shows that the optimal incentive contract for innovative employees has an option-like form, and that a firm may want to worsen the distribution of possible innovations. The model's predictions are consistent with a broad set of observed regularities regarding the creation of employee startups.
    Keywords: Startups, innovation, reputation, venture capital
    JEL: L14 L26 O31 O34 M13
    Date: 2016–07
  2. By: Kudic, Muhamed; Ehrenfeld, Wilfried; Pusch, Toralf
    Abstract: We apply a network perspective and study the emergence of core-periphery (CP) structures in innovation networks to shed some light on the relationship between isolation and innovation. It has been frequently argued that a firm's location in a densely interconnected network area improves its ability to access information and absorb technological knowledge. This, in turn, enables a firm to generate new products and services at a higher rate compared to less integrated competitors. However, the importance of peripheral positions for innovation processes is still a widely neglected issue in literature. Isolation may provide unique conditions that induce innovations which otherwise may never have been invented. Such innovations have the potential to lay the ground for a firm's pathway towards the network core, where the industry's established technological knowledge is assumed to be located. The aim of our paper is twofold. Firstly, we propose a new CP indicator and apply it to analyze the emergence of CP patterns in the German laser industry. We employ publicly funded Research and Development (R&D) cooperation project data over a period of more than two decades. Secondly, we explore the paths on which firms move from isolated positions towards the core (and vice versa). Our exploratory results open up a number of new research questions at the intersection between geography, economics and network research.
    Abstract: Wir legen eine Netzwerkperspektive zugrunde und untersuchen die Entstehung von Kern-Peripherie- (CP-) Strukturen in Innovationsnetzwerken, um den Zusammenhang zwischen Isolation und Innovation vertiefend zu beleuchten. In bisherigen Studien wurde argumentiert, dass die Lage eines Unternehmens in dicht verknüpften Bereichen eines Netzwerks seine Fähigkeit verbessert, auf Informationen zuzugreifen und technologisches Wissen zu absorbieren. Dies erlaubt es solchen Unternehmen, neue Produkte und Dienstleistungen in einem höheren Maße zu generieren als weniger integrierte Konkurrenzunternehmen. Die Bedeutung peripherer Positionen für Innovationsprozesse ist jedoch bisher ein weitestgehend vernachlässigter Aspekt in der Literatur. Isolation kann ein einzigartiges Umfeld bereitstellen, das Innovationen induzieren kann, die anderenfalls niemals entstanden wären. Solche Innovationen können die Grundlage für den Pfad eines Unternehmens in Richtung des Netzwerk-Kerns bilden, von dem angenommen wird, dass sich dort das in der Branche etablierte technologische Wissen konzentriert. Unser Beitrag verfolgt zwei Ziele. Erstens schlagen wir einen neuen CP-Indikator vor und wenden ihn an, um die Entstehung von CP-Strukturen in der deutschen Laserindustrie zu analysieren. Dazu verwenden wir Projektdaten zu öffentlich geförderten Kooperationen über einen Beobachtungszeitraum von mehr als zwei Jahrzehnten. Zweitens untersuchen wir die Pfade, auf denen sich Unternehmen aus isolierten Positionen in Richtung des Kerns bewegen (und umgekehrt). Unsere Ergebnisse eröffnen eine Reihe von Fragestellungen an der Schnittstelle zwischen Geographie, Wirtschaft und Netzwerkforschung.
    Keywords: innovation networks,core-periphery,laser industry,Innovationsnetzwerke,Kern-Peripherie,Laserindustrie
    JEL: C45 D85 O31 O32
    Date: 2015
  3. By: Rene Belderbos; Leo Sleuwaegen; Dieter Somers; Koen De Backer
    Abstract: With the emergence of global value chains (GVCs), production processes are increasingly fragmented and dispersed across different countries. Although many MNEs still exhibit an important ‘home bias’ in their global innovation activities, a growing number of firms have offshored R&D and innovative activities to foreign locations. Is the more recent offshoring of R&D and innovation linked to the prior waves of manufacturing offshoring? The fear in OECD economies is that because of co-location effects between production and innovative activities, the loss of certain manufacturing/assembly activities may result in a loss of innovative capabilities (R&D, design, etc.) in the longer-term. The offshoring of R&D and innovation within GVCs poses new challenges to economic policy in OECD and emerging economies. For example, how can countries attract inward R&D investments by foreign MNEs? Should outward R&D investments by MNEs be a concern for the countries in which the MNEs are headquartered?
    Date: 2016–07–12
  4. By: Pau Roldan (New York University); Laurent Cavenaile (New York University)
    Abstract: We develop a model of firm dynamics through product innovation that explicitly incorporates advertising decisions by firms. We model advertising by constructing a framework that unifies a number of facts identified by the empirical marketing literature. The model is then used to explain several empirical regularities across firm sizes using U.S. data. Through a novel interaction between R&D and advertising, we are able to explain empirically observed deviations from Gibrat’s law, as well as the behavior of advertising expenditures across firms, the degree of substitution between R&D and advertising expenditures as firms grow large, and broadly the effects of advertising on both firm and economic growth. We find that smaller firms can be both more innovation- and advertising-intensive as in the data even when there exist increasing returns to scale in research.
    Date: 2016
  5. By: Intarakumnerd, Patarapong (Asian Development Bank Institute); Goto, Akira (Asian Development Bank Institute)
    Abstract: Policies for stimulating technological development and innovation in small and medium-sized enterprises can be divided into three groups. Supply-side policies aim at increasing firms’ incentives to invest in innovation by reducing costs. Demand-side policies are public actions to induce innovation and/or speed up the diffusion of innovation. Systemic policies focus on strengthening interactive learning between actors in innovation systems. Policies can be implemented through various instruments comprising tax incentives, grants or direct subsidies, low-interest loans, and the government’s direct equity participation. These instruments have pros and cons. The experiences of four late-industrializing East Asian economies—Taipei,China; Singapore; Malaysia; and Thailand—provide key lessons. Firms at different levels of technological and innovative capability need different policy instruments. The more successful economies have a higher level of flexibility and policy coordination and learning. The amount, duration, and continuity of government supporting schemes are crucial. Policy makers must have a deep understanding of what constitutes innovations and innovation systems, and how they evolve over time. Innovation financing policies require other corresponding policy initiatives to make them successful. Lastly, institutional factors do shape the choices and effective implementation of these policies.
    Keywords: technological development; East Asia SMEs; diffusion of innovation; demand-side policies
    JEL: D22 L25 O31
    Date: 2016–07–20
  6. By: Jean-Francois Mercure
    Abstract: Knowledge acquisition by consumers is a key process in the diffusion of innovations. However, in standard theories of the representative agent, agents do not learn and innovations are adopted instantaneously. Here, we show that in a discrete choice model where utility-maximising agents with heterogenous preferences learn about products through peers, their stock of knowledge on products becomes heterogenous, fads and fashions arise, and transitivity in aggregate preferences is lost. Non-equilibrium path-dependent dynamics emerge, the representative agent exhibits behavioural rules different than individual agents, and aggregate utility cannot be optimised. Instead, an evolutionary theory of product innovation and diffusion emerges.
    Date: 2016–07
  7. By: Heuschneider, Sara; Herstatt, Cornelius
    Abstract: To stay ahead of the competition, firms need to constantly adapt to the changing environment by identifying new opportunities and product innovations. The search for future discontinuities and trends using external knowledge sources enables firms to develop a foresight capability to proactively shape future direction and to improve innovation capacity. Recent open innovation literature discusses external search strategies and their impact on innovation performance. In order to investigate the implications of these findings for external search in the context of foresight, this paper aims to systematically analyze the current focus and intellectual structure of the external search field by means of co-citation and content analysis. Findings indicate a strong focus of the research field on the external search for innovations, e.g. for new product ideas and problem solutions throughout the innovation process. However, it is so far poorly understood how firms can employ external search to detect future discontinuities and trends in the environment. To address this knowledge gap, dimensions of search strategies are derived from the current external search literature and are assessed with respect to their relevance for search in the context of foresight. In the course of the discussion, the breadth and depth of external search as well as the technological, geographical and relational distance of search are found to be relevant dimensions of external search strategies for identifying future developments. The identified dimensions can serve as a starting point to further investigate how firms can benefit from different external search strategies to identify discontinuities and trends in the environment. The paper closes with practical implications and suggestions for further research in this area.
    Keywords: external search,corporate foresight,discontinuities,trends,innovation management,search strategies
    Date: 2016
  8. By: Córcoles, David; Triguero, Ángela; Cuerva, María Carmen
    Abstract: The main purpose of this paper is to analyze the influence of previous experience and learning capabilities on survival in product and process innovation for Spanish manufacturing firms in the period 1990-2010. The authors find past and path dependence and confirm the important effect of R&D effort in both types of innovation. Nevertheless, for product innovation, the level of appropriability and the fact of operating in a high-tech sector are crucial for persistence in comparison with process innovation.
    Keywords: persistence in innovation,product innovation,process innovation,discrete-time duration models,panel-data
    JEL: O31 O32 L22 L60
    Date: 2016
  9. By: Merle Jacob (Lund University Sweden); Asa Lindholm Dahlstrand (Lund University Sweden); Sprutacz Maren (European Commission - JRC)
    Abstract: The 2015 series of RIO Country Reports analyse and assess the policy and the national research and innovation system developments in relation to national policy priorities and the EU policy agenda with special focus on ERA and Innovation Union. The executive summaries of these reports put forward the main challenges of the research and innovation systems.
    Keywords: R&I system, R&I policy, ERA, innovation union, Semester analysis, Belgium
    JEL: I20 O30 Z18
    Date: 2016–06
  10. By: Pietro Moncada-Paternò-Castello (European Commission – JRC)
    Abstract: This paper contributes with new findings to the literature on corporate research and development (R&D) intensity decomposition by examining the effects of several parameters on R&D intensity and investigating its comparative distribution among top R&D firms, sectors and world regions/countries. It draws on a longitudinal company-level micro-dataset from 2005 to 2013, and uses both descriptive statistics and decomposition computation methods. The results confirm the structural nature of the EU R&D intensity gap. In the last decade the gap between the EU and the US has widened, whereas the EU gap with Japan and Switzerland has remained relatively stable. The study also uncovers differences in R&D intensity between EU and US companies operating in the sectors more responsible for the aggregate R&D intensity gap. In contrast, the BRIC (Brazil, Russia, India and China) and Asian Tiger countries (Hong Kong, Singapore, South Korea and Taiwan) R&D intensity gap compared to the EU has remained relatively stable, while companies from the rest of the world are considerably reducing such gap. Finally, the study shows a high concentration -sustained over time- of R&D investment in a few countries, sectors and firms, but in the EU there are fewer smaller top R&D firms that invest more intensively in R&D, than in the most closed competing countries.
    Keywords: corporate R&D; decomposition; EU R&D intensity gap, EU R&D policy
    JEL: O30 O32 O38 O57
    Date: 2016–07
  11. By: Sofka Wolfgang (Copenhagen Business School); Sprutacz Maren (European Commission - JRC)
    Abstract: The 2015 series of RIO Country Reports analyse and assess the policy and the national research and innovation system developments in relation to national policy priorities and the EU policy agenda with special focus on ERA and Innovation Union. The executive summaries of these reports put forward the main challenges of the research and innovation systems.
    Keywords: R&I system, R&I policy, ERA, innovation union, Semester analysis, Germany
    JEL: I20 O30 Z18
    Date: 2016–06
  12. By: Kamal Saggi (Vanderbilt University)
    Abstract: This paper surveys the literature on international trade and the protection of intellectual property rights (IPRs) in the global economy. The discussion is organized around the major questions in the field. How does openness to trade affect national incentives for patent protection? What is the rationale for international coordination over patent policies? Given that countries are highly asymmetric with respect to their technological capabilities, what incentives do lagging countries have for enforcing IPRs and what are the consequences of requiring them to do so? To what extent do empirical studies support the major arguments for and against the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS)? Finally, can the structure of TRIPS -- both in terms of the core obligations it imposes on WTO members and the flexibilities that it provides them with respect to exhaustion policies and the use of compulsory licensing -- be reconciled with existing models of IPR protection in the global economy?
    Keywords: intellectual property rights, TRIPS, WTO, innovation, trade, foreign direct investment, imitation, patent protection, welfare, exhaustion policies, compulsory licensing.
    JEL: F1 O3
    Date: 2016–07–19
  13. By: Ju-Chuan Wu (Department of Business Administration, Feng Chia University); Chih-Jou Chen (Department of Marketing and Logistics Management, National Penghu University of Science and Technology)
    Abstract: Due to progression of modern medication and technology, the average life span is extending, pursuing high-quality, healthy and long life growing to an old age is more desirable than ever. Taiwan is one of the fastest growing aging countries in Asia, in addition to the problem of an aging population; birth rate is also very low, nursing and elderly care might affect our financial and economic development. This research aims to explore the current situation of aging society, the gap between user’s attitude toward aging and the ICT needs for better performance of ICT innovative products and (or) service. In this study, the proposed model is composed the concepts of attitude toward aging, Innovation Diffusion Theory, and User’s Informational-Based Readiness. The research findings show that be helpful to the further application, cross-field cooperation, and long-term development between ICT and elderly service industry.
    Keywords: Aging in Place, Attitude toward aging, Information and Communication Technology (ICT), Service Innovation, Innovation Diffusion Theory Technology Readiness, User’s Informational-Based Readiness
  14. By: Iritié, B. G. Jean Jacques
    Abstract: Criticisms vis-à-vis cluster policy are numerous, often confusing and really unhelpful; while some authors systematically question the merits, others on the contrary play a genuine role of counsel in his favour. This paper attempts to refocus the debate and analyses the economic issues, impacts and implications of the innovation clusters policy. To do this, we take a critical view of the literature on clusters, focusing on analysis of the effects of three industrial dynamics in perpetual movement within clusters, especially research and development, industrial location and technology cooperation. We assume that innovation cluster "potentiates", by a synergistic action, the beneficial effect of each of these three industrial dynamics in favour of localised firms. However, it appears from the analysis that the hopes and expectations invested in cluster policy must be reconsidered and relativised. So the reasons for the rising power of cluster policies must be sought elsewhere than in a necessarily consensual and tangible evidence of positive impacts of clusters.
    Keywords: cluster,innovation,competitiveness pole,research and development,industrial location,technology cooperation,localised knowledge spillovers,LKS,epistemic communities
    JEL: O25 O30 R10
    Date: 2016
  15. By: Qadri, Mubashar; Mamoon, Dawood
    Abstract: The idea “Creating shared value” (CSV) offers a resolute direction to the debate on the link between business and society which can be restored through three distinct actions such as a) reconceiving products and markets; b) redefining productivity in the value chain; and c) building supportive industry clusters. The critical analysis predicts that the path of these actions is progressive in nature and their scope apparently ranges from narrow to wider deliberations. Keeping variant scope of proposed actions, this particular paper encapsulates only first course of action which indirectly is anticipating a new wave of innovation. For this new wave of innovation, the role of social capital is explored to determine the extent this capital can drive next wave of innovation. In this regard, a model is proposed to predict the link between various dimensions of social capital and innovation that can produce both social and business revenues. The proposed model is based on the assumption that social capital is not limited to network theory only rather its origins are deep rooted and relations with community are more important and relevant. If organizations emphasize more and invest in developing relationships with network actors like suppliers, customers and rivalry firms, then potential benefits of social capital might be unnoticed. Therefore, similar to defining ‘value’ too narrowly due to strategic myopia, keeping the social circle of small radius also limit the organization’s ability to exploit the embedded potential of social capital.
    Keywords: Creating shared value (CSV), Social capital, Innovation, Network relationship(s)
    JEL: M2
    Date: 2016–07
  16. By: Horbach, Jens; Janser, Markus (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "The environmental sector is supposed to yield a dual benefit: its goods and services are intended to help to tackle environmental challenges and its establishments should create new jobs. However, it is still unclear in empirical terms whether that really is the case. This paper investigates whether employment growth in 'green' establishments with 'green' products and services is higher compared to other establishments. Furthermore, the main factors determining labor demand in this field are analyzed. We use linked employment and regional data for Germany. The descriptive results show that the environmental sector is characterized by disproportionately high employment growth. The application of both a generalized linear mixed model and an instrumental variables regression reveals that especially innovation and industry agglomeration foster employment growth in establishments in the environmental sector. Establishments without green products and services show a smaller increase in employment, even if they are also innovative." (Author's abstract, IAB-Doku) ((en))
    Keywords: Umweltschutzindustrie, Beschäftigungseffekte, Innovation, Arbeitskräftenachfrage
    JEL: J23 Q52 Q55 R23
    Date: 2015–05–28
  17. By: Creighton, Mathew; Dykema, Jennifer; Gaia, Alessandra; Cernat, Alexandru; Garbarski, Dana; Jamal, Amaney; Kaminska, Olena; Keusch, Florian; Lynn, Peter; Oberski, Daniel; Schaeffer, Nora Cate; Uhrig, S.C. Noah; Yan, Ting
    Abstract: This paper presents some preliminary findings from Wave 8 of the Innovation Panel (IP8) of Understanding Society: The UK Household Longitudinal Study. Understanding Society is a major panel survey in the UK. May 2015, the eighth wave of the Innovation Panel went into the field. IP8 used a mixed-mode design, using on-line interviews and face-to-face interviews. This paper describes the design of IP8, the experiments carried and the preliminary findings from early analysis of the data.
    Date: 2016–07–04
  18. By: Slavtchev, Viktor; Göktepe-Hultén, Devrim
    Abstract: We empirically analyze whether support by the parent organization in the early (nascent and seed) stage speeds up the process of commercialization and helps spin-offs from public research organizations generate first revenues sooner. To identify the impact of support by the parent organization, we apply multivariate regression techniques as well as an instrumental variable approach. Our results show that support in the early stage by the parent organization can speed up commercialization. Moreover, we identify two distinct channels - the help in developing a business plan and in acquiring external capital - through which support by the parent organization can enable spin-offs to generate first revenues sooner.
    Keywords: academic entrepreneurship,support,TTO,commercialization,time to market
    JEL: L26 M13 O31 O32 O33
    Date: 2015
  19. By: Berthold Herrendorf (Arizona State University)
    Abstract: We build a model of structural transformation with endogenous sector-biased technological change. We show that if the return to specialization is larger in the goods sector than in the service sector, then the equilibrium has the following properties: aggregate growth is balanced; the service sector receives more innovation but the goods sector experiences more productivity growth; structural transformation takes place from goods to services. Compared to the efficient allocation the laissez-faire equilibrium has too much labor in the goods sector, implying that optimal industrial policy should aim to increase, not decrease, the pace of structural transformation.
    Date: 2016
  20. By: Fernando Galindo-Rueda; Fabien Verger
    Abstract: This paper provides a new taxonomy of industries according to their level of R&D intensity - the ratio of R&D to value added within an industry. Manufacturing and non-manufacturing activities are clustered into five groups (high, medium-high, medium, medium-low, and low R&D intensity industries), drawing on new and expanded evidence from most OECD countries and some partner economies. This paper also reports on differences in R&D intensity within industries across countries. This document represents an update and reframing of previous OECD taxonomies based on earlier versions of the International Standard Industrial Classification (ISIC), including services, whose coverage has improved in the R&D tables published by OECD (ANBERD). This taxonomy aims to support the presentation of statistics for industry groups when R&D is a relevant discriminant factor. Other existing or in-development taxonomies may be more appropriate for capturing differences in overall knowledge intensity or technology use.
    Date: 2016–07–16
  21. By: Daria Ciriaci; Nicola Grassano; Antonio Vezzani
    Abstract: This paper investigates how product and labour market regulations and red tape affect the way in which top corporate research and development (R&D) investors worldwide organise their crossborder operations. The decision about where a company locates its international subsidiaries is modelled using location-specific framework conditions, socio-economic factors and other controls commonly used in the economic geography literature. The location decision drivers are estimated using a multilevel mixed-effects logistic regression, controlling for both fixed and random effects. Our results confirm that both product market regulation (PMR) and employment protection legislation (EPL) significantly affect the location decisions of top R&D investors, as well as red tape and profit tax. The marginal effect of PMR is by far the largest, followed by EPL; the cost of starting a business and profit tax show lower marginal effects. Moreover, we found that (i) PMR and EPL exert a mutually reinforcing negative effect on the location decision of top R&D investors and (ii) of the three components of the PMR indicator —barriers to trade and investment, state control and barriers to entrepreneurship—the latter is the one with the lowest marginal effect. Policy implications are drawn accordingly.
    JEL: F23 D22 L20
    Date: 2016–05
  22. By: Baziki, Selva B. (Central Bank of Turkey); Ginja, Rita (Uppsala University); Borota Milicevic, Teodora (Uppsala University)
    Abstract: This paper provides new evidence on the reallocation of workers across firms and industries with different technologies in response to increased import competition from developing countries. Using employer-employee matched data for the Swedish manufacturing sector, we find increased assortative matching of workers in ICT (information and communication technologies) intensive industries, that is, high(low)-wage workers sort into high(low)-wage firms. Industries with low ICT intensity do not exhibit these sorting patterns. A labour market matching model explains the increased assortative matching in ICT intensive industries in response to stronger import competition through an increase in the relative demand for qualified workers.
    Keywords: wage inequality, employment dynamics, assortative matching, import competition, technological change
    JEL: F16 J63 O33
    Date: 2016–07
  23. By: Yu-Hui Wang (National Taipei University of Technology); Tzu-han Chow (National Taipei University of Technology)
    Abstract: Voice data transmission is an important revenue source for mobile communications operators. VoLTE is the technology driver of the growth for 4G LTE voice data transmission. The first wave of VoLTE-enabled devices became commercially available between 2014 and 2016. To understand the global development of VoLTE technology, this study examines VoLTE patent portfolios and identifies area for VoLTE patent applications and commercialization. We recommend that mobile communications companies establish a competitive advantage with VoLTE technology leadership prior to the year 2018. All manufacturers should act expeditiously to develop patent protection for the next generation of voice communications technology. This research provides mobile-telecom service providers, mobile network operators, and terminal equipment manufacturers with an understanding of the VoLTE technology frontier and the competitive status of emerging innovations.
    Keywords: Signal processing, Patent intelligence, Patent map
    JEL: O32 O34
  24. By: Veronica Mies (Pontificia Universidad Catolica de Chile); Matias Tapia (Pontificia Universidad Catolica de Chile); Ignacio Loeser (Pontificia Universidad Catolica de Chile)
    Abstract: We use census micro data aggregated at the state level data for US cohorts born between 1915 and 1939 to test the impact of secondary and tertiary schooling in the US at the state-cohort level on R&D and TFP growth across industries in 1970. We instrument our measures of schooling by using the variation in compulsory schooling laws and differences in mobilization rates in WWII, which we relate to the education benefits provided by the GI Bill Act (1944). This novel instrument provides a clean source of variation in the costs of attending college. Two-stage least squared regressions find no effect of the share of population with secondary schooling on outcomes such as n R\&D per worker or TFP growth. On the other hand, the share of population with tertiary education has a significant effect on both R&D per worker or TFP growth.
    Date: 2016
  25. By: Heenkenda, Shirantha
    Abstract: The main objective of this study is to explore the feasibility of farmers’ organizations (FOs) as a vehicle for microinsurance delivery for paddy crop cultivated by small-scale (peasant) farmers in Sri Lanka. Ampara district, on Sri Lanka’s eastern plain was selected to conduct the field survey. Factor Analysis is used to elicit the group dynamic and capacity of FOs as a stakeholder of the insurance supply chain. The results show that the farmers’ organization is most widespread and very close institutional setup for paddy farmers. FOs are capable of handling financial activities with transparency, and have healthy financial habits and those farmers participate actively in farmers’ organization activities. This study provided clear policy insights into the design of institutions channel that foster cooperation, and of the characteristics of FOs. To assist in the FOs financial activities, the postal network can act as financial intermediaries in circumstances where the commercial insurers do not have an outlet or branch networks in their target area. For developing the linkages between farmers and insurers, the public-private partnership model can be used for microinsurance supply to paddy farmers in Sri Lanka. In this context, multi-stakeholder partnerships should be made imperative for paddy farmers’ insurance delivery aimed at widespread coverage or large-scale implementation.
    Keywords: Farmers’ Organizations, Financial Intermediaries, Insurance Delivery, Microinsurance
    JEL: G2 G22
    Date: 2016–02–14
  26. By: Alexander Coad (European Commission – JRC); Sara Amoroso (European Commission – JRC); Nicola Grassano (European Commission – JRC)
    Abstract: Although diversity between team members may bring benefits of new perspectives, nevertheless, what holds a team together is similarity. We theorise that diversity in one dimension is traded off against diversity in another. Our analysis of collaborative research teams that received FP7 funding presents robust results that indicators of diversity in several dimensions (diversity of organizational form (universities, firms, etc.), diversity in nationality, and inequality in project funding share) are negatively correlated with each other.
    Keywords: diversity, collaborative teams, FP7 research funding
    JEL: O30 M14 O19
    Date: 2016–06
  27. By: Pellens, Maikel; Della Malva, Antonio
    Abstract: This article documents a structural change in the production of science in the U.S. semiconductor industry over almost three decades. We observe a change in scientific productivity over time, where smaller firms publish more articles per dollar in R&D. Moreover, our results show a positive relationship between the value of intangibles and scientific publications, driven by basic research results. These effects are especially strong among Fabless 'design' firms and among firms in the post-PC era of semiconductor manufacturing, in line with a premium for smaller firms which invest in science in times of structural technological change.
    Keywords: corporate science,basic science,firm value,semiconductors
    JEL: O31 O33
    Date: 2016
  28. By: Christian Boehler (European Commission – JRC); Fabienne Abadie (European Commission – JRC)
    Abstract: DG JRC-IPTS has been developing a Monitoring and Assessment Framework to assess the health and economic impact of the activities carried out by stakeholders of the European Innovation Partnership on Active and Healthy Ageing (EIP on AHA) within the MAFEIP project. In this context, IPTS has conceptualised a decision analytic model which has been implemented as a web-based tool, the MAFEIP tool. This tool builds up from a variety of surrogate endpoints commonly used across the diverse set of EIP on AHA commitments in order to estimate health and economic outcomes of the Partnership. Stakeholders can access the tool through an intuitive web-based user interface that is linked to a database of country, age and gender specific mortality data. This report offers a review of the issues encountered with the set-up of the model, the usability of the tool, technical issues and further gaps that could be identified in the course of the tool implementation as well as issues related to data collection. It offers recommendations as to what improvements could be undertaken in the future.
    Keywords: EIP, Active and Healthy Ageing, EIP on AHA, indicators, monitoring, framework, health states, markov, model
    Date: 2016–06
  29. By: Jen Chia Chang (Graduate Institute of Technological & Vocational Education, National Taipei University of Technology); Hsi Chi Hsiao (Department of Business Administration, Cheng Shiu University); Su Chang Chen (Institute of service management, National Penghu University of Science and Technology); Tien Li Chen (Department of Industrial Design, National Taipei University of Technology); Pei Jou Chiu (Graduate Institute of Technological & Vocational Education, National Taipei University of Technology)
    Abstract: Innovation is an important basis for successfully gaining global market shares in the era of technological changes. In order to maintain national competitiveness, the government attaches great importance to innovative thinking ability. To this end, throughout various stages of education in Taiwan, creativity competitions are held. Among them, at universities and colleges, annual innovation and entrepreneurship competitions are held; at vocational high schools, national creativity project work competitions are held. In this study, award-winning students from the two competitions were selected. The creative concept design capability scale was adopted to compare the award winners and non-winners in terms of differences in innovative thinking points. The creative concept design capability scale was used to assess the gap among students who received training, college project instructors, and student innovative thinking points. Findings show that the overall innovative thinking points are mostly concentrated in the appearance. University/college of technology or vocational high school competition award winners alike have a significantly higher total score compared to the total innovative thinking points score of regular university/college of technological teachers and students. However, as to the innovative thinking points for different categories, university and college award winners of innovation entrepreneurship competitions tend to put the chemical change of innovative thinking points to better uses; vocational high school award winners of creativity project work competitions tend to put the external size and external texture layout of innovative thinking points to better uses. The university and college students on the project team are better able to use the physical changes, structural complexity, operability, shape changes, functional enhancement, and usage enhancement of the innovative thinking points. This study recommends that students select more related professional practical courses to “learn by doing†. Students are encouraged to participate in off-campus learning activities or creativity competitions so that they can broaden their horizons. As for teaching, teachers may lead students in site visits to learn about innovative products in the industry. The course design combines theory and practice, case discussions are examples of which.
    Keywords: Innovative thinking points, Competition award winner, Creativity
    JEL: I20 I23 I29
  30. By: Petrakis, Emmanuel; Moreno, Diego; Manasakis, C.; Cabolis, C.
    Abstract: We study a homogenous good triopoly in which firms first choose their cost-reducing R&D investments and consider alternative merger proposals, and then compete à la Cournot in the ensuing industry. We identify conditions under which both horizontal mergers and non integration are sustained by Coalition-Proof Nash equilibria (CPNE). These conditions involve the effectiveness of the R&D technology, as well as the distribution of the bargaining power between the acquirer and the acquiree, which determine the allocation of the incremental profits generated by the merger. We show that whether firms follow duplicative or complementary research paths, sustaining a merger generally requires a sufficiently effective R&D technology that creates endogenous cost asymmetries and renders the merger profitable, and a moderate distribution of bargaining power that allows to spread the benefits of the merger. We examine the welfare effects of mergers and obtain clear policy guidelines.
    Keywords: Coalition-Proof Nash Equilibrium; Antitrust; Endogenous Efficiency Gains; Cost-Reducing Innovation; Horizontal Mergers
    Date: 2016–06–01
  31. By: Jane Humphries (All Souls College, University of Oxford); Benjamin Schneider (Merton College, University of Oxford)
    Abstract: The prevailing explanation for why the Industrial Revolution occurred first in Britain is Robert Allen’s (2009) ‘high-wage economy’ view, which claims that the high cost of labour relative to capital and fuel incentivized innovation and the adoption of new techniques. This paper presents new empirical evidence on hand spinning before the Industrial Revolution and demonstrates that there was no such ‘high-wage economy’ in spinning, a leading sector of industrialization. We quantify the working lives of frequently ignored female and child spinners who were crucial to the British textile industry in the Early Modern period with evidence of productivity and wages from the late sixteenth to the early nineteenth century. Our results show that spinning was a widespread, low-wage, low-productivity employment, in line with the Humphries (2013) view of the motivations for the factory system.
    Keywords: hand spinning, women's wages, Industrial Revolution, textiles, Great Divergence, High Wage Economy interpretation of invention and innovation
    JEL: J24 J31 J42 J46 N13 N33 N63 O14 O31
    Date: 2016–06–05
  32. By: Dominik Karos
    Abstract: The members of a society are faced with the decision whether or not to participate in an anti-government protest. Their utilities depend on their own decision but also on those of their neighbors in an underlying social network. They randomly observe other people's decisions, gather information on who is already active, and base their decision on their information. The model uses a Markov process (that depends on the underlying social network) to analyze who will become active over time. Two new features are essential: first, only very mild assumptions about the underlying social network are made, in particular agents can be entirely heterogeneous. Second, individuals are allowed to coordinate their decision if they mutually observe each other. The government can use political violence in order to change people's utility from being active. The probability of a revolution can thereby be reduced in the short run, but not in the long run. Under political repression protests do not increase gradually, but suddenly; and the conditional probability of a quick revolution given a protest increases if the regime turns violently against the protesters. Since large jumps in the number of activists depend on their capability to coordinate, the repression of political activism is more effective in countries where social media are not easily accessible. The findings are illustrated by data on the number of protests and revolutions world-wide depending on a country's number on the Political Terror Scale.
    Keywords: Social Networks, Coordination, Strong Nash Equilibrium, Innovation Diffusion, Unanticipated Revolutions, Political Repression
    JEL: C72 D85 O33
    Date: 2016–07–06
  33. By: Blien, Uwe (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Ludewig, Oliver (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "One of the key issues in economics is the explanation of unemployment and its variation across different economies. Modern mainstream macroeconomics refers to the effects of financial crises and to institutional structures and their variation across countries. However, unemployment within the European states varies nearly as much as between these countries. In the interior of a country, however, there are only minor differences in institutions. To solve this puzzle, we explain this variation of unemployment building on the regional industry composition and technological progress. It is shown formally that under general and standard preconditions the price elasticity of demand on product markets is decisive: Technological progress leads to an expansion of employment if product demand is elastic. It is accompanied, however, by shrinkage of employment if product demand is inelastic. A transition from the elastic into the inelastic range of the demand function for the most important product(s) can already suffice to plunge a region into crisis. In our empirical analysis we use industry level time series data on output, prices, employment and national income for Germany provided by the Federal Statistical Office. We estimate Marshallian type demand functions using an instrumental variables estimator to derive the price elasticities for different industries and link this information to the regional labour market performance of the respective industries and regions." (Author's abstract, IAB-Doku) ((en))
    JEL: Q33 R11 J23
    Date: 2016–07–12

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