nep-ino New Economics Papers
on Innovation
Issue of 2016‒10‒09
23 papers chosen by
Uwe Cantner
University of Jena

  1. Protecting innovation through patents and trade secrets: Determinants and performance impacts for firms with a single innovation By Crass, Dirk; Garcia Valero, Francisco; Pitton, Francesco; Rammer, Christian
  2. Risky Recombinations: Institutional Gatekeeping in the Innovation Process By Ferguson, John-Paul; Carnabuci, Gianluca
  3. Openness and environmental innovation: Does time-horizon matter? By MOTHE Caroline; NGUYEN Thi Thuc Uyen
  4. Entrepreneurial Human and Social Capital in Small Businesses in Vietnam - An Extended Analysis - By Souksavanh VIXATHEP; Nobuaki MATSUNAGA
  5. Financial constraints and the failure of innovation projects By José García-Quevedo; Agustí Segarra-Blasco; Mercedes Teruel
  6. Innocentive Un modèle hybride d'innovation basé sur l'appel à la foule et l'Innovation Ouverte By Isabelle Liotard; Valérie Revest
  7. Unraveling the link between managerial risk-taking and innovation: The mediating role of a risk-taking climate By Ana García-Granero; Óscar Llopis; Anabel Fernández-Mesa; Joaquín Alegre
  8. A Portrait of Firms that Invest in R&D By Lucia Foster; Cheryl Grim; Nikolas Zolas
  9. The Economic Impact of Venture Capital: Evidence from Public Companies By Gornall, Will; Strebulaev, Ilya A.
  10. Innovation Policies and New Regional Growth Paths: A place-based system failure framework By Grillitsch, Markus; Trippl, Michaela
  11. Administration Costs in the Management of Research Funds; A Case Study of a Public Fund for the Promotion of Industrial Innovation By David R Walwyn
  12. How Do Complementors Respond to the Threat of Platform Owner Entry? Evidence from the Mobile App Market By Wen Wen; Feng Zhu
  13. R&D heterogeneity and its implications for growth By Sigurd Mølster Galaasen; Alfonso Irarrazabal
  14. The Effect of Innovation Box Regimes on Income Shifting and Real Activity By De Simone, Lisa; Lester, Rebecca
  15. Innovative public-private partnership to support Smart City: the case of “Chaire REVES” By Laurent Dupont; Laure Morel; Claudine Guidat
  16. Evolutionary Cournot competition with endogenous technology choice: (in)stability and optimal policy By Lamantia, F.; Negriu, A.; Tuinstra, J.
  17. Designing dynamic research contests By Jean-Michel Benkert; Igor Letina
  18. Entrepreneurial role models, fear of failure, and institutional approval of entrepreneurship: A tale of two regions By Wyrwich, Michael; Stuetzer, Michael; Sternberg, Rolf
  19. What kind of entrepreneurs start high productivity businesses? By Maliranta, Mika; Nurmi, Satu
  20. Increasing Returns in a Model With Creative and Physical Capital: Does a Balanced Growth Path Exist? By Batabyal, Amitrajeet
  21. Entrepreneurship after displacement: The transition and performance of entrepreneurial ventures created after displacement By Nyström, Kristina
  22. Currency Overvaluation and R&D Spending By Arthur Korus
  23. Los determinatentes internacionales de la evolución del sistema español de patentes durante el siglo XIX By Pretel, David

  1. By: Crass, Dirk; Garcia Valero, Francisco; Pitton, Francesco; Rammer, Christian
    Abstract: This paper tests a number of hypotheses on the use and effectiveness of patents and trade secrets designed to protect innovation. While previous studies have often considered patents and trade secrets as substitutes for one another, we investigate the complementary role of the two protection methods. We identify protection strategies for single innovation firms and hence overcome the assignment problem of existing empirical studies, i.e. whether firms using both protection methods do so for the same innovation or for different innovations. Employing firm panel data from Germany, we find fairly few differences between the determinants for choosing secrecy and patenting. Single innovators that combine both strategies, 39% of the group, tend to aim at a higher level of innovation and act in a more uncertain technological environment. Firms combining both protection methods yield significantly higher sales with new-to-market innovations. Using only secrecy has slightly stronger positive impacts on firm profitability.
    Keywords: Patents,Trade Secrets,Performance Impacts,Single Innovation
    JEL: O31 O32 O34
    Date: 2016
  2. By: Ferguson, John-Paul (Stanford University); Carnabuci, Gianluca (University of Lugano)
    Abstract: Theories of innovation and technical change posit that inventions that combine knowledge across technology domains have greater impact than inventions drawn from a single domain. The evidence for this claim comes mostly from research on patented inventions and ignores failed patent applications. We draw on insights from research into institutional gatekeeping to theorize that, to be granted, patent applications that span technological domains must be better than otherwise-comparable, narrower applications. Using data on failed and successful patent applications, we estimate an integrated, two-stage model that accounts for differential selection. We find that more domain-spanning patent applications are less likely to be approved, and that controlling for this differential selection reduces the estimated effect of knowledge recombination on innovation impact by about a third. By conceptualizing the patent-approval process as a form of institutional gatekeeping, this paper highlights the institutional underpinnings of and constraints on the innovation process.
    Date: 2015–07
  3. By: MOTHE Caroline; NGUYEN Thi Thuc Uyen
    Abstract: The antecedents of environmental innovation and the impact of openness on technological innovation have been well studied, yet the role of external knowledge search remains largely unknown. This study explores whether six dimensions of open search (external R&D, acquisition, R&D cooperation, and three types of external information sourcing) enhance firms? environmental innovation (EI) when used either sporadically or persistently. It shows that the temporal dimension of openness matters. Persistent open knowledge search efforts are associated with a firm?s propensity to introduce EI, more so than sporadic search. Furthermore, the different types of knowledge search have heterogeneous effects on different types of EI. It also shows that persistent innovation is more relevant in the case of radical EI.
    Keywords: Environmental innovation; Incremental/radical; Openness; Persistence; Search
    Date: 2016–10
  4. By: Souksavanh VIXATHEP (Graduate School of Economics, Kyoto University); Nobuaki MATSUNAGA (Graduate School of International Cooperation Studies, Kobe University)
    Abstract: Entrepreneurship is viewed as an important mechanism for economic development. It helps entrepreneurs overcome most of the constraints in businesses, encourages innovation, and contributes to employment generation and welfare improvement. The paper addresses the issue of entrepreneurial contribution to economic development at the micro level in Vietnam. The study examines the impact of entrepreneurial human capital on firm's performance (value added, total factor productivity (TFP)) in micro and small enterprises (MSEs). The analysis reveals that owner's formal education (up to upper secondary education) contributes to enhancement of firm value added and TFP in micro businesses. Entrepreneur's technical specialization, including advanced vocational training, university and post-graduate education, enhances performance of small enterprises, but shows some sign of over-education for micro businesses. Accumulated entrepreneurial experience, in form of occupation and self-employment experience, proves crucial for firm performance. Geographical advantages favoring MSEs located in the major metropolitan areas and sectoral advantages favoring 'trade and services' prove to be significant. The findings highlight the importance of human capital in nurturing entrepreneurship and fostering economic development at the micro-level.
    Keywords: entrepreneurship; human capital; social capital; small business; Vietnam
    JEL: C01 D22 L26
    Date: 2015–04
  5. By: José García-Quevedo (IEB, Universitat de Barcelona); Agustí Segarra-Blasco (GRIT, Universitat Rovira i Virgili); Mercedes Teruel
    Abstract: Theoretical and empirical approaches have stressed the existence of financial constraints in firms’ innovative activities. Although a large number of innovation projects are abandoned before their completion, the empirical evidence has focused on the determinants of innovation while failed projects have received little attention. This paper analyses the role of financial obstacles on the likelihood of abandoning an innovation project by using panel data of potential innovative Spanish firms for the period 2005–2013. Our analysis differentiates between internal and external barriers on the probability of abandoning a project and we examine whether the effects are different depending on the stage of the innovation process. Controlling for potential endogeneity, we use a bivariate probit model to take into account the simultaneity of financial constraints and the decision to abandon an innovation project. Our results show that financial constraints most affect the probability of abandoning an innovation project during the concept stage.
    Keywords: barriers to innovation, failure of innovation projects, financial constraints
    JEL: O31 D21
    Date: 2016–09
  6. By: Isabelle Liotard (CEPN - Centre d'Economie de l'Université Paris Nord - Université Paris 13 - Université Sorbonne Paris Cité (USPC) - CNRS - Centre National de la Recherche Scientifique); Valérie Revest (TRIANGLE - Triangle : action, discours, pensée politique et économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - Institut d'Études Politiques [IEP] - Lyon - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Longtemps, l'innovation a été perçue comme un processus purement interne, conduit au sein de l'entreprise, cette dernière la considérant comme un trésor à faire fructifier et à maintenir dans son périmètre. En effet, durant les 19 ème et 20 ème siècles, les firmes ont eu pour objectif de développer leur projet en interne, et de détenir de manière exclusive les droits sur leur processus d'innovation et/ou de création. Or, depuis quelques décennies, des entreprises innovantes appartenant à des industries variées choisissent de plus en plus de faire appel à leur environnement extérieur pour développer une partie de leurs innovations. L'enjeu est crucial : pour alimenter un processus d'innovation toujours risqué, complexe, long et couteux, la R&D interne « seule » ne suffit plus. L'acquisition de connaissances externes, combinée aux activités de R&D interne apparaît alors comme un mécanisme efficace pour accroître l'ensemble des connaissances technologiques produites par les entreprises, dans un contexte d'Innovation Ouverte (Open Innovation), aux fortes dimensions participatives et collaboratives. Cette alchimie associant dimension interne et externe a pris depuis plusieurs formes, visant à assurer notamment la complémentarité des ressources : réseaux de partenaires – privés et /ou publics, accords de licences, coalitions ou partenariats autour de projets technologiques, clusters, pôles de compétitivité (Teece, 1986). L'objectif de cet article est d'analyser l'apparition d'une nouvelle configuration d'organisation de la recherche et de l'innovation portée par Internet. Le développement sans précédent du Web a conduit à la mise en place de nouvelles structures d'intermédiation visant à accélérer la captation de savoirs externes par les entreprises. Innocentive, fondée en 2000, représente la première plateforme d'intermédiation mettant en relation des entreprises confrontées à un problème lié à leur recherche et des « apporteurs de solutions » du monde entier (Lakhani et al, 2007). Au travers d'une plateforme en accès libre, des entreprises postent des « questions » technologiques (plus ou moins larges) et proposent pour chaque défi, une prime afin de récompenser la meilleure solution proposée après une période de concours. Nous montrons que l'originalité d'une telle plateforme provient de la nature du rôle d'intermédiation joué par les gestionnaires de la plateforme, qui ne se limite par à un simple rôle de mise en relation entre deux groupes d'acteurs, mais qui consiste à extraire et transformer des savoirs académiques en solutions opérationnelles pour des entreprises. Un second résultat concerne les propriétés et caractéristiques d'Innocentive. Cette plateforme se distingue tant des communs au sens propre (logiciel libre, Wikipédia..) que des formes multiples d'entreprises collaboratives et ouvertes dont Internet a permis l'essor. On la désignera comme un « hybride », naviguant entre innovation ouverte et innovation fermée, entre biens communs et biens privés. S'appuyant sur une communication autour de l'Innovation Ouverte, la plateforme utilise l'architecture de l'Internet (un commun) et des savoirs existants (dont certains sont de l'ordre du bien commun) pour assurer une marchandisation des connaissances et leur privatisation. L'un de ses traits centraux est ainsi de 2 s'appuyer sur des mécanismes de « crowdsourcing » (externalisation ouverte faisant appel à la foule des internautes) pour alimenter les processus d'innovations des firmes clientes et partenaires de la plateforme. La première section met en lumière l'intermédiation active proposée par Innocentive. La seconde section se focalise sur les caractéristiques de la plateforme à travers le prisme de l'Open Innovation et de la notion de biens communs de la connaissance.
    Keywords: innovation , contest , Internet
    Date: 2015
  7. By: Ana García-Granero (INGENIO (CSIC-UPV), MTS - Management Technologique et Strategique - Grenoble École de Management (GEM)); Óscar Llopis (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - Université Montesquieu - Bordeaux 4 - CNRS - Centre National de la Recherche Scientifique, INGENIO (CSIC-UPV)); Anabel Fernández-Mesa (INGENIO (CSIC-UPV), Departament de Direcció d'Empreses - Universitat de València); Joaquín Alegre (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - Université Montesquieu - Bordeaux 4 - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Scholars have proposed that taking risks in organizations is important for explaining innovation performance. Scholars traditionally have analyzed this link from two unconnected perspectives. From a managerial perspective, entrepreneurial orientation and leadership theories have been used to explain the positive relation between risk taking and innovation. From an employee perspective, creativity theory suggests that a risk-taking climate helps to explain innovative behaviors. However, there is little empirical research analyzing this link. This study examines the possibility of a connection between managers’ risk-taking propensities, employees’ risk-taking climate, and innovation performance. To do so, we test a quantitative model where the impact of the manager’ risk-taking propensity on innovation is mediated by its effect on employees’ risk-taking climate. Structural equation modeling is used to test the research hypotheses on a data set of 182 firms from the Spanish and Italian ceramic tile industry.
    Keywords: signaling theory,social cognitive theory,managers´ risk-taking,Innovation performance,risk-taking climate
    Date: 2015–05
  8. By: Lucia Foster; Cheryl Grim; Nikolas Zolas
    Abstract: We focus on the evolution and behavior of firms that invest in research and development (R&D). We build upon the cross-sectional analysis in Foster and Grim (2010) that identified the characteristics of top R&D spending firms and follow up by charting the behavior of these firms over time. Our focus is dynamic in nature as we merge micro-level cross-sectional data from the Survey of Industrial Research and Development (SIRD) and the Business Research & Development and Innovation Survey (BRDIS) with the Longitudinal Business Database (LBD). The result is a panel firm-level data set from 1992 to 2011 that tracks firms’ performances as they enter and exit the R&D surveys. Using R&D expenditures to proxy R&D performance, we find the top R&D performing firms in the U.S. across all years to be large, old, multinational enterprises. However, we also find that the composition of R&D performing firms is gradually shifting more towards smaller domestic firms with expenditures being less sensitive to scale effects. We find a high degree of persistence for these firms over time. We chart the history of R&D performing firms and compare them to all firms in the economy and find substantial differences in terms of age, size, firm structure and international activity; these differences persist when looking at future firm outcomes.
    Date: 2016–01
  9. By: Gornall, Will (University of British Columbia); Strebulaev, Ilya A. (Stanford University)
    Abstract: Over the past 30 years, venture capital has become a dominant force in the financing of innovative American companies. From Google to Intel to FedEx, companies supported by venture capital have profoundly changed the U.S. economy. Despite the young age of the venture capital industry, public companies with venture capital backing employ four million people and account for one-fifth of the market capitalization and 44% of the research and development spending of U.S. public companies. From research and development to employment to simple revenue, the companies funded by venture capital are a major part of the U.S. economy.
    Date: 2015–11
  10. By: Grillitsch, Markus (CIRCLE, Lund University); Trippl, Michaela (Department of Geography and Regional Research, University of Vienna)
    Abstract: Regional economies are increasingly facing the challenge to renew their economic structures and generate innovations that break existing development paths. This calls for new innovation policy approaches that are well equipped to foster the modernisation of existing industries and nurture the development of new ones. The aim of this chapter is to provide a comprehensive place-based system failure framework for an innovation policy design that is suitable to initiate and support economic renewal processes in different region-specific contexts. Our framework rests on three pillars. The first one draws a distinction between barriers that relate to rigidities of the current industrial, knowledge and institutional structures on the one hand and impediments that hinder the emergence of new development paths on the other hand. The second conceptual cornerstone differentiates between various forms of new path development, namely path upgrading, modernization, branching, importation and new path creation. Third, to capture varying regional characteristics, we distinguish between thin, thick and specialised and thick and diversified regions. Our conceptual discussion demonstrates that each region type suffers from particular combinations of barriers to structural change. This offers a sound basis for assessing which types of new path development are most likely to occur in thin, thick and specialised and thick and diversified regions and for identifying promising policy approaches to fashion regional structural change in various regional contexts.
    Keywords: regional innovation policy; place-based system failures; regional structural change; new regional industrial path development
    JEL: O33 O38 R11 R58
    Date: 2016–10–04
  11. By: David R Walwyn
    Abstract: Research funding agencies routinely use a proportion of their total revenues to support internal administration and marketing costs. The ratio of administration to total costs, referred to as the administration ratio, is highly variable and within any single fund depends on many factors including the number and average size of projects and the overall efficiency of the funding agency. In this study, the standard agency activities have been identified and used to develop a model of administration costs against expected outcomes. In particular, the model has been designed to estimate the optimum portfolio success rate and administration ratio as a function of a range of key input variables including the project size, the complexity of proposal evaluation and project management, the risk tolerance of the sponsor and the targeted research domain.
    Date: 2016–09
  12. By: Wen Wen (University of Texas at Austin, McCombs School of Business, 2110 Speedway, Austin, TX 78712); Feng Zhu (Harvard University, Harvard Business School, Morgan Hall 431, Boston, MA 02163)
    Abstract: How do complementors respond to the threat of platform owner entry, and how do such responses differ from the responses to actual entry? Using the mobile platform Android as our research setting, we examine how app developers on Android adjust their rate and direction of innovation efforts and prices in response to Google’s entry threat and actual entry into to the app markets. Based on a difference-indifferences empirical framework, we find that app developers that are affected by Google’s entry reduce their innovation efforts on affected apps after entry threats increase; after Google’s actual entry, they reduce innovation efforts on affected apps further and also increase these apps’ prices. However, we find that affected app developers do not withdraw from the platform completely—once the threat occurs, they shift innovation efforts from affected apps to other unaffected apps, as indicated by an increase in updates on unaffected apps during both the entry-threat and actual-entry period.
    Keywords: platform owner entry; entry threat; innovation; mobile app industry
    JEL: L11 L86 O32
    Date: 2016–09
  13. By: Sigurd Mølster Galaasen (Norges Bank (Central Bank of Norway)); Alfonso Irarrazabal (Norwegian Business School (BI))
    Abstract: This paper quantifies the determinants of heterogeneity in R&D investment and its implications for growth. Using a panel of Norwegian manufacturing firms we document a negative correlation between R&D intensity and firm size, driven mainly by small firms with high R&D intensity. We estimate a Schumpeterian growth model with heterogeneous firms, that differ with respect to innovation efficiency. The estimated model fits the shape of the R&D investment distribution as well as the negative correlation between R&D intensity and firm size. A larger selection effect contribution to aggregate growth is found when we include R&D moments in the estimation. Finally, we study the link between firm heterogeneity and R&D subsidies, and show that the growth effects of subsidies depend crucially on how the policy influences the equilibrium distribution of firms.
    Keywords: R&D, Heterogeneous Firms, Subsidies, Growth
    JEL: L11 O3 O4
    Date: 2016–09–29
  14. By: De Simone, Lisa (Stanford University); Lester, Rebecca (Stanford University)
    Date: 2016
  15. By: Laurent Dupont (ERPI - Equipe de Recherche sur les Processus Innovatifs - UL - Université de Lorraine); Laure Morel (ERPI - Equipe de Recherche sur les Processus Innovatifs - UL - Université de Lorraine); Claudine Guidat (ERPI - Equipe de Recherche sur les Processus Innovatifs - UL - Université de Lorraine)
    Abstract: Purpose-French universities can play a key role in generating Smart City approach through an innovative Public-Private Partnership dedicated to urban transformation. Methodology-We led an action-research study for five years with several research and pedagogic projects including users or citizens. Findings-The paper points out main factors of Smart City development. It also presents shared demonstrators’ characteristics including industrial scale, sustainability and citizens’ participation. Practical implications-University of Lorraine diversification strategy through the “Chaire REVES” supported by public and private partners. Social implications-At regional level, industrial-university-territorial partnerships could tackle both societal and economical issues “with”, “for”, and “by” citizens. Originality/value-Based on the Living Lab concept our case study shows a concrete regional university strategy involving: user-centric design, collaborative processes, citizens’ workshops and new financial and organizational answers enabling collaboration between private companies and public institutions. Our paper also argues that innovative public and private partnership involving users are necessary for developing smart cities.
    Keywords: Collaborative innovation, Public-Private Partnership, sustainable urban transformation, diversification strategy, shared demonstrator,Smart City, Living Lab
    Date: 2015
  16. By: Lamantia, F. (University of Amsterdam); Negriu, A. (University of Amsterdam); Tuinstra, J. (University of Amsterdam)
    Abstract: We study a dynamic oligopoly market model where quantity setting firms can choose one of two production technologies. We find that boundedly rationality in production (best-reply dynamics) and technology choice (evolutionary selection of better performing technologies) as sources of market dynamics, can generate endogenous instability and complicated dynamics, including chaotic fluctuations and co-existing attractors with fractal basins of attraction. By studying successively more complex versions of our model we analyze these two different sources of instability separately and also investigate their interaction. We find that boundedly rational production decisions amplify technological instability whereas boundedly rational technology decisions do not contribute to the production-driven destabilization of the Nash equilibrium. In any case, whenever the two types of decisions interfere in an endogenously unstable market, fluctuations follow a visibly different pattern compared to the fluctuations of a market with only one source of instability. Finally, we show that an innovation policy that aims to alter the market equilibrium without taking into account off-equilibrium dynamics may, in an intrinsically dynamic world, generate welfare losses by destabilizing a stable equilibrium and/or by raising the amplitude of market fluctuations.
    Date: 2016
  17. By: Jean-Michel Benkert; Igor Letina
    Abstract: This paper considers the optimal design of dynamic research contests when the buyer can set time-dependent prizes. We derive the buyer-optimal contest and show that it entails an increasing prize schedule. Remarkably, this allows the buyer to implement a global stopping rule. In particular, the optimal contest attains the first-best. More generally, we show that global stopping rules can be implemented robustly and compare them to individual stopping rules which have been analyzed in the existing literature. We conclude by discussing policy implications of our findings and highlight that global stopping rules combine the best aspects of innovation races and research tournaments.
    Keywords: Innovation, contests, dynamic tournaments, global stopping rule, breakthroughs, R&D
    JEL: O32 D02 L19
    Date: 2016–09
  18. By: Wyrwich, Michael; Stuetzer, Michael; Sternberg, Rolf
    Abstract: Studies on the influence of entrepreneurial role models (peers) on the decision to start a firm ar-gue that entrepreneurial role models in the local environment (1) provide opportunities to learn about entrepreneurial tasks and capabilities, and (2) signal that entrepreneurship is a favorable career option thereby reducing uncertainty that potential entrepreneurs face. However, these studies remain silent about the role of institutional context for these mechanisms. Applying an ex-tended sender-receiver model, we hypothesize that observing entrepreneurs reduces fear of fail-ure in others in environments where approval of entrepreneurship is high while this effect is signif-icantly weaker in low approval environments. Taking advantage of the natural experiment from recent German history and using data from the Global Entrepreneurship Monitor Project (GEM), we find considerable support for our hypotheses.
    Keywords: Fear of failure, role models, peer effect, entrepreneurial intentions, Global Entrepreneurship Mon-itor, East Germany
    JEL: D1 L26 M13 P20 R23 Z13
    Date: 2016
  19. By: Maliranta, Mika; Nurmi, Satu
    Abstract: The Finnish economy is suffering from a prolonged hollow in productivity. For a solid bounce, arguably Finland would need new high productivity firms. To analyze where entrepreneurs of such firms come from and what they are like, we have constructed a novel Finnish Longitudinal OWNer-Employer-Employee (FLOWN) database. Here we focus on limited liability companies with one dominant owner who works in her own firm and who has hired at least one additional employee. We find that these entrepreneurs typically have previous experience as an employee in another high productivity firm and, moreover, this is strongly positively associated with her current firm’s higher productivity and survival probability. In addition, a strong link between the productivity performance and the owner’s formal university education in a technical field is established. These findings are robust to controlling for a number of entrepreneur and employee attributes. Finally, we find that firms that were founded in times of intensive job reallocation currently had superior productivity performance.
    Date: 2016–10–06
  20. By: Batabyal, Amitrajeet
    Abstract: In this note we study aspects of economic growth in a region that produces a final consumption good with creative and physical capital. This consumption good is manufactured with a production function that exhibits increasing returns to scale. Our analysis leads to three results. First, we compute the growth rate of creative capital in our regional economy. Second, we show that despite the presence of increasing returns, the regional economy under study converges to a balanced growth path (BGP). Finally, we compute the growth rates of physical capital and output on the BGP.
    Keywords: Balanced Growth Path, Creative Capital, Creative Region, Economic Growth, Increasing Returns
    JEL: D20 R11
    Date: 2016–06–05
  21. By: Nyström, Kristina (Center of Excellence for Science and Innovation Studies (CESIS), Division of Entrepreneurship and Innovation, Department of Industrial Economics and Management, The Royal Institute of Technology, & The Ratio Institute, Stockholm Sweden.)
    Abstract: According to Hoetker and Agarwal (2007), research on knowledge transfers related to business closures is scarce. This paper intends to fill the knowledge gap on the transition to entrepreneurship after a business closure. This paper studies which employees are most likely to start an entrepreneurial venture after being affected by a displacement. Furthermore, following e.g., Hyttinen and Maliranta (2008) and Sørensen (2007), this study investigates the link between former workplace characteristics, such as the size and age of the former workplace, and the transition into entrepreneurship. In the second part of the analysis, the performance of the entrepreneurial ventures started by employees after displacement are explored as it relates to survival, employment and profitability. The empirical setting employs an employer–employee matched dataset coving all displaced employees in Sweden during 2001-2010. The empirical findings suggest that employees displaced from smaller firms are more likely to transition to entrepreneurship, Employing a Cox proportional hazard model to study the survival of these companies shows that new firms generated by displaced employees from small establishments are more viable. Furthermore, individuals who took part in labor market polices have a higher probability of becoming entrepreneurs, although these firms tend to show lower survival rates, which indicates that these transitions are necessity based. As for the performance of the business, the empirical findings suggest modest growth in terms of employment, turnover and operating profit for the vast majority of entrepreneurial ventures started after displacement.
    Keywords: Displacements; exit. Entrepreneurship; Labor mobility
    JEL: J63 L26
    Date: 2016–09–30
  22. By: Arthur Korus (Europäisches Institut für Internationale Wirtschaftsbeziehungen (EIIW))
    Abstract: This paper investigates the impact of an overvalued currency on R&D spending in manufacturing sectors. In particular, we explore whether a real overvaluation against the US Dollar affects R&D investments in manufacturing sectors of OECD countries. So far the literature has elaborated on either the impact of exchange rate swings on R&D investment or the effect of exchange rate volatility on R&D spending. Thus, to the author's best knowledge, this study is the first which investigates the relationship between real overvaluation and R&D spending. In this paper, we test empirically whether real overvaluation against the US dollar has a direct effect as well as an indirect effect via export activity on R&D investment by using OECD panel data of the manufacturing sectors of 16 OECD countries. We find that real overvaluation against the US dollar both directly and indirectly affects R&D intensities in manufacturing sectors. Furthermore, we have evidence that real overvaluation against the US Dollar caused by monetary policy and financial factors negatively affects R&D intensities in manufacturing sectors.
    Keywords: Real Exchange Rate, Equilibrium Real Exchange Rate, Overvaluation, R&D Intensity, Innovation, OECD countries
    JEL: F31 F41 O32
    Date: 2016–09
  23. By: Pretel, David (El Colegio de México)
    Abstract: The various nineteenth-century national patent systems had a heterogeneous institutional evolution. This article explores the international determinants of this institutional diversity, using the Spanish system as a case study. Instead of presenting the causality as running from institutions to economic performance, it explores the inverse relationship, that is, how Spain’s technological backwardness and dependency set the stage for the institutional organisation of this country’s patent system. The international dynamics manifested in different aspects of the system: its peripheral, hybrid and dual nature; the Spanish reception of the European controversy over patent rights; the early Spanish integration into the international patent system; and the prominence of international intermediaries. The article concludes that nineteenth-century variations in the institutional architecture and the administrative practices of the various national systems were the consequence of the historical making of an asymetric international patent system.
    Keywords: patents, international system, institutional diversity, intermediaries
    JEL: N73 O3 F55 B1
    Date: 2016–09

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