nep-ino New Economics Papers
on Innovation
Issue of 2017‒05‒28
nineteen papers chosen by
Uwe Cantner
University of Jena

  1. Environmental Policy in an Endogenous Growth Model with Expanding Variety By Bianco, Dominique
  2. Modern World Practice of State Support of Perspective Scientific and Innovative Programs: Evaluation of the Developed Mechanisms of State Management of Innovation Development in the Context of Time Challenges By Kushlin, Valery; Ustenko, Viktoriya
  3. Effectiveness of Fiscal Incentives for R&D; Quasi-Experimental Evidence By Irem Guceri; Li Liu
  5. Innovation-Led Transitions in Energy Supply By Derek Lemoine
  6. Les Stratégies Régionales d’Innovation de « spécialisation intelligente » en Europe (Smart Specialization Strategies) : Dynamiques territoriales endogènes et institutions exogènes By Philippe Lefebvre
  7. Innovationspfade in der deutschen Automobilzulieferindustrie: Eine Untersuchung aus der Frugalitätsperspektive By Bergmann, Stephan; Tiwari, Rajnish
  8. The Impact of Process Innovation on Prices: Evidence from Automated Fuel Retailing in The Netherlands By Adriaan R. Soetevent; Tadas Bruzikas
  9. Innovation and The Precautionary Principle By Caroline Orset
  10. Building a firm level dataset for the analysis of industrial dynamics and demography By M. Grazzi; C. Piccardo; C. Vergari
  11. Temporary and permanent technology lock-ins in the quality-differentiated Bertrand competition By Anton Bondarev; Frank C. Krysiak
  12. The journey in Open Innovation to develop a SME: A longitudinal case study in a French robotics company By Jean-Claude Boldrini; Guy Caverot; Maxime Ezequel
  13. The Economic Microgeography of Diversity and Specialization By Andersson, Martin; Larsson, Johan P.; Wernberg, Joakim
  14. Foreign Ownership and Skill-biased Technological Change By Michael Koch; Marcel Smolka
  15. Development of Competitive Tools for Access to Basic, Competitive and Program Budget Funding for Research and Innovations in the Russian Federation By Kurakova, Natalia; Zinov, Vladimir; Tsvetkova, Liliya; Kupriyanova, Olga
  16. The promise of blockchain By Demary, Markus; Demary, Vera
  17. Green Technology Adoption and the Business Cycle By Jean-Marc Bourgeon; Margot Hovsepian
  18. Excessive and under-investment: on the incentives to adopt new technologies under Pigouvian taxes and tradeable permits By Requate, Till
  19. Does patenting always help new-firm survival? By Masatoshi Kato; Koichiro Onishi; Yuji Honjo

  1. By: Bianco, Dominique
    Abstract: In this paper, we analyze the long-term impact of an environmental policy on economic growth, pollution and welfare. A standard growth model with horizontal innovation is modified by including pollution which comes from the use of intermediate goods production. Taxation on pollution reduces profits of final good producer as well as intermediate good producers. In this setting, profit gains is explained by a realloaction of labor from intermediate goods sector to R&D sector which enhances innovation, growth and welfare while it reduces pollution.
    Keywords: Porter hypothesis, endogenous growth, environmental policy
    JEL: D43 O31 O41 Q58
    Date: 2017–03
  2. By: Kushlin, Valery (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Ustenko, Viktoriya (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: In connection with the increased instability in the world and the uncertain economic conditions in many active countries, work has been undertaken to create reliable prerequisites for the resumption of sustainable economic growth, among which science and technology factors are again emerging in the forefront. After some certain decrease on this front, due in large part to the fact that the innovative potential associated with the technological structure that prevailed in the world from the 1970s to the end of the first decade of the 21st century (the fifth in terms of technological structure, ??if the terminology of the theory advocates Kondratieff's long-wave cycles of development), signs of the beginning and even the acceleration of work on scientific and technical programs, suggesting the transition to the next - the sixth technological structure. Given the high capital intensity of such works and the presence of heightened risks, they unfold there and in so far as this is encouraged and supported at the governmental level. Therefore, the task of finding the most effective mechanisms and methods of managing and supporting the state through the implementation of promising scientific and innovative programs is extremely actual.
    Date: 2017–04
  3. By: Irem Guceri; Li Liu
    Abstract: With growing academic and policy interest in research and development (R&D) tax incentives, the question about their effectiveness has become ever more relevant. In the absence of an exogenous policy reform, the simultaneous determination of companies’ tax positions and their R&D spending causes an identification problem in evaluating tax incentives. To overcome this identification challenge, we exploit a U.K. policy reform and use the population of corporation tax records that provide precise information on the amount of firm-level R&D expenditure. Using difference-in-differences and other panel regression approaches, we find a positive and significant impact of tax incentives on R&D spending, and an implied user cost elasticity estimate of around -1.6. This translates to more than a pound in additional private R&D for each pound foregone in corporation tax revenue.
    Keywords: Europe;United Kingdom;Tax incentives; corporation tax returns; quasi-experiment, Tax incentives, corporation tax returns, quasi-experiment, Business Taxes and Subsidies, Innovation and Invention: Processes and Incentives
    Date: 2017–03–31
  4. By: J.Lowenberg-DeBoer (Department of Agricultural Economics, College of Agriculture, Purdue University, W. Lafayette, IN); Shehu Musa (University of Science and Technology (KUST) Wudil, P.M.B 3244 Kano – Nigeria); Christopher A. Wolf
    Abstract: With five million bags sold in the 2007-2015 period and thousands of rural vendors, the Purdue Improved Crop Storage (PICS) bags have been a very successful innovation for African and Asian farmers. The primary Purdue University intellectual property (IP) in PICS is the trademark. The goal of this study is to describe the role of PICS trademark licensing in the PICS success. Some key points from the study: •Trademarking PJCS seems to have been an effective strategy for combating low quality imitators. Initially, PICS trademarking was suggested by a Nigerian PICS manufacturer as a way to manage imitators. While several large manufacturers have made their own version of the triple layer PICS bag, none of those larger businesses tried to use the trademark. The small "backyard" manufacturers who tried to use the trademark stopped when sent a cease and desist letter by Purdue. Anecdotal accounts indicate that West African farmers have confidence in PICS trademarked bags and prefer to buy them to store their crops. •As donorfunding wound downfor PJCS projects, the trademark became the main mechanism for Purdue support to manufacturers and licensees. The trademark license provides a formal, legal structure within which that relationship can function. Ina context where national institutions are weak, many manufacturers and distributors find that technical support from Purdue attractive. The support provided ranged widely from help with manufacturing problems to facilitating succession when a licensee died without leaving succession plans. •PJCS has shown that African and Asian licensees are willing topay licensefees, but the transactions and opportunity costs are high on both sides. Those transactions costs include bank wire fees, exchange costs, staff effort and informal taxes required for the paperwork. In the developing country context where cash is hard to come by and work capital perpetually lacking, there is a real opportunity cost of sending some of that money out of the country, instead of reinvesting it in the business. •The sustainability of the PJCS brand probably requires moving management outside of the university. University business processes are slow and cumbersome. Management costs are high because of public sector accounting and personnel rules. University faculty and staff have many responsibilities; they cannot devote full time to commercialization of an innovation. •The most durable impact of the PICS project is in the private investment in developing the next generation of hermetic grain storage for smallholder farmers. Twenty years ago those companies would have dismissed the idea of developing grain storage technology for small holder farmers. The perception was that smallholder farmers lacked the entrepreneurial motivation and/or the cash flow to be a substantial market. PICS showed the business community that there is a market on smallholder farms for technologies that solve their problems.
    Keywords: agriculture,technology,intellectual property,licensing,stewardship
    JEL: Q16
    Date: 2017
  5. By: Derek Lemoine
    Abstract: I reconcile a benchmark model of directed technical change with the historical experience of energy transitions by allowing for a non-unitary elasticity of substitution between machines and the other factor of production, interpreted here as energy resources. I show that the economy becomes increasingly locked-in to the dominant sector when machines and resources are gross substitutes, but a transition from the dominant sector to the other is possible when machines and resources are gross complements. Consistent with history, a transition in research activity leads the transition in resource supply. A calibrated numerical implementation shows that innovation is critical for climate change policy. A policymaker would use a U-shaped emission tax trajectory so as to immediately transition innovation away from the fossil sector, wait for clean technology to improve, and then hasten a transition in resource supply later in the century.
    JEL: N70 O33 O38 O44 Q43 Q54 Q55 Q58
    Date: 2017–05
  6. By: Philippe Lefebvre (CGS i3 - Centre de Gestion Scientifique i3 - MINES ParisTech - École nationale supérieure des mines de Paris - PSL - PSL Research University - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Alors que les dynamiques territoriales d’agglomération des activités et d’innovation sont : 1) souvent abordées comme des dynamiques spontanées, qui relèvent de différences de ressources entre territoires (nouvelle économie géographique) ou de dynamiques endogènes propres à un territoire et à son histoire (économie géographique institutionnelle, économie géographique évolutionniste, école des proximités) ; 2° parfois abordées comme des dynamiques résultant d’initiatives délibérées mais venant toujours du territoire lui-même et de ses acteurs (toujours dans une logique d’endo-genèse territoriale), - nous proposons ici d’examiner le cas où des cadres institutionnels exogènes au territoire tentent de s’imposer à lui, d’intensifier ou de ré-orienter les dynamiques territoriales à l’œuvre. Quoique peu étudié comme tel, ce cas de figure est déjà très répandu (politiques publiques de clusters, par exemple) et ne cesse de gagner en importance (notamment à travers les politiques publiques territoriales énoncées par des autorités supra-territoriales). L’article étudie le cas des stratégies régionales d’innovation en France, des stratégies dont les règles d’élaboration et de formulation sont imposées depuis 2000 par la Commission européenne à toutes les régions européennes qui veulent pouvoir bénéficier, au titre de l’innovation, des très importants financements du FEDER". Partant de ce cas, il s'efforce d'apporter des éléments de réponse à quatre des grandes questions qui se posent dans les rapports entre dynamiques territoriales endogènes et cadrages institutionnels exogènes au territoire : 1. Les cadrages institutionnels exogènes sont-ils porteurs de représentations, implicites ou explicites, des dynamiques territoriales actuelles ou des dynamiques territoriales visées et souhaitables à terme ? Sont-ils contraignants ou respectueux des dynamiques territoriales existantes ? 2. Comment les territoires, avec leurs dynamiques endogènes, intègrent-ils ces règles ou y réagissent ? Rétroagissent-ils sur la conception des règles qui tentent de s’imposer à eux de l’extérieur ? Parviennent-ils à infléchir ces règles dans le sens d’une plus grande prise en compte de leurs dynamiques propres ? 3. Comment ces cadrages institutionnels, exogènes aux territoires et conçus pour s’imposer à plusieurs territoires à la fois, sont-ils conçus par les autorités supra-territoriales agissantes ? 4. Enfin, quels impacts – qualitatifs (en terme d’orientations) ou quantitatifs (en terme d’importance relative) – ont ces cadrages institutionnels sur les dynamiques territoriales (y compris les dynamiques endogènes) ?
    Keywords: innovation, smart specialization strategies, Régions, Europe, H2020, institutions, policy process
    Date: 2017–03–24
  7. By: Bergmann, Stephan; Tiwari, Rajnish
    Abstract: Frugale Innovationen werden oftmals in Verbindung mit Schwellenländern genannt, jedoch zeigen erste Studien, dass diese auch zunehmend an Relevanz in Industrienationen gewinnen. In diesem Arbeitspapier präsentieren wir die Ergebnisse verschiedener, durchgeführter Teilstudien zur Analyse der Innovationspfade in der deutschen Automobilzulieferindustrie und erläutern die Bedeutung frugaler Innovationen für die deutsche Automobilzulieferindustrie. Die deutsche Zulieferindustrie zeichnet sich insbesondere durch intensive Aktivitäten in den Bereichen Innovation sowie Forschung und Entwicklung aus. Der erste Teil der Forschungsarbeit beinhaltet eine umfangreiche Literaturanalyse und befasst sich mit der Durchführung von sechs Fallstudien sowie einer Patentanalyse zur Bestimmung der Innovationspfade und prägender Innovationsmerkmale. Die Fallstudien und die Patentanalyse beziehen sich auf den untersuchten Zeitraum von 2010 bis 2015. Der zweite Teil der Forschungsarbeit befasst sich mit der Validierung der Ergebnisse durch semistrukturierte Interviews. Hierzu wurden neun Experten mit insgesamt sechs unterschiedlichen Hintergründen befragt. Die Ergebnisse der Arbeit zeigen wichtige Einflussfaktoren auf die Innovationsaktivitäten auf und deuten darauf hin, dass die Frugalität in der deutschen Automobilzulieferindustrie eine durchaus wichtige Rolle einnimmt. Insbesondere sind hierbei die Erschwinglichkeit und die einfachere Gestaltung der Komponenten zu nennen. Die Aussagen der interviewten Industrieexperten stimmen mit diesen Ergebnissen überein und weisen auf das beachtliche Potential frugaler Innovationen in der deutschen Zulieferindustrie hin.
    Keywords: Innovationspfade,Frugale Innovation,Fallstudien,Patentanalyse,Automobilindustrie
    Date: 2017
  8. By: Adriaan R. Soetevent (University of Groningen); Tadas Bruzikas (University of Groningen)
    Abstract: In the last decade, many European countries have seen a sharp increase in the number of automated fueling stations. We study the effect of this process innovation on prices at stations that are automated and their competitors using a difference-in-differences matching strategy. Our estimates show that prices at automated stations drop by 1.0 to 2.1% immediately after conversion and stabilize at this lower level. We find no indication of competitive spillover effects to neighboring sites at the conventional significance levels. Other than previous studies, our estimates do not reveal a difference in impact between early and later adopters of automation.
    Keywords: technology adoption; retail gasoline; pricing; competition
    JEL: C22 D4 L13 L81
    Date: 2017–05–10
  9. By: Caroline Orset (ECO-PUB - Economie Publique - INRA - Institut National de la Recherche Agronomique - AgroParisTech)
    Abstract: Recent environmental policies favour the polluter pays principle. This principle points out the pollutant financial liability for the eventual incidents induced by his activities. In this context, we analyse the decision of an agent to invest in new industrial activities, the consequences of which on human health and the environment are initially unknown. It is not possible for him to delay investing, but the agent has the opportunity to acquire information and to reduce the cost of an accident. This allows the agent to reduce uncertainty regarding dangers associated with the project and to limit potential damages that it might cause. However, the agent's chosen level of these actions may be considered as insufficient and not acceptable by Society as response in the face of a possible danger. Precautionary state regulation may then be introduced. We get that this regulation may slow down innovation and may favour innovation in countries with less safety requirements. We find that agent may get around the goal of the regulation by ignoring the information on the dangerousness of its project. We then propose some policy tools which stimulate innovation and impose a certain level of risk considered as acceptable for Society to the agent. Finally, we use a numerical analysis based on the Monsanto Company for studying the agent's behaviour with different regulatory frameworks.
    Keywords: uncertainty,the precautionary principle,environment, information acquisition,irreversible investment
    Date: 2017–04–03
  10. By: M. Grazzi; C. Piccardo; C. Vergari
    Abstract: This paper illustrates the building procedure of a firm-level panel dataset that merges several sources of information concerning the various activities of business firms. The aim of this work is to achieve a detailed dataset able to shed light on firm demographics, in terms of survival, entry and exit processes, distinguishing between “voluntary" and “involuntary" exits. Moreover, the derived dataset allows to monitor the innovation activities of the firms and also to capture complementarities between two instruments of intellectual property rights (IPRs), namely granted patents and registered trademarks. We assess the validity of the proposed procedures resorting to the virtual universe of Italian limited liability companies as provided by Bureau van Dijk (BvD). The dataset covers more than 1 million companies operating in both manufacturing and service sectors and contain financial and economic information, as well as, among the others, the ownership structure and administrative procedures undergone by the firms, which may lead to firm exit. The main purpose of the paper is to provide a unified set of procedures to help the researcher dealing with the vast amount of information available on corporate firms and of ever increasing size. This will also facilitate the replication of empirical analyses, across researchers working on dataset with similar characteristics, although from different countries or data providers.
    JEL: C81 L60 L80 O14 O34
    Date: 2017–05
  11. By: Anton Bondarev; Frank C. Krysiak (University of Basel)
    Abstract: We consider a setting where strategic behavior of r&d rms can lead to di erent types of a technology lock-in, permanent or temporary, in an eventually inferior technology. The simple setting with one incumbent and one potential entrant may lead to a wide variety of possible strategic regimes. We study conditions on relative market strength of the incumbent and the entrant which lead to di erent strategic actions and demonstrate, that such a strategic behavior is not always socially suboptimal, since it may lead to faster development of the existing technology due to persistent threat of the potential entrant. We further elaborate on the selection of support tools which may induce the development of new technology in the secondbest world and establish criteria for these tools to be social welfare improving ones.
    Keywords: technology lock-in, technological change, strategic interaction, r&d policy, multiple regimes
    JEL: C61 O31 O38
    Date: 2017
  12. By: Jean-Claude Boldrini (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes); Guy Caverot (société BA Systèmes); Maxime Ezequel (société BA Systèmes)
    Abstract: Open innovation has become a major topic in innovation management. Research however has mostly focused on large companies, in the area of inbound open innovation, on the technological scope or industrial protection. The topic of outbound open innovation, the processes implemented and the management practices deployed in SMEs have been less well investigated. This article aims to go some way towards filling this gap. A collaborative longitudinal case study was carried out by a researcher and two practitioners in a robotics SME. The results show the impact, mainly positive, of open innovation on the company. The functions of technological gatekeeper and “innovation project promoter”, created while the open innovation process was being established, are illustrated through the examples of previous collaborative projects and a current major research European project applied to robotics in which the company is involved.
    Abstract: L’innovation ouverte est devenue un thème majeur du management de l’innovation. La recherche s’est toutefois focalisée sur les grandes entreprises, sur l’innovation ouverte entrante (inbound), sur ses dimensions technologiques ou sur la protection industrielle. Les questions liées à l’innovation ouverte sortante (outbound), aux processus implémentés et aux pratiques managériales déployées dans les PME ont été moins investiguées. Cet article tente de combler ces lacunes. Une étude de cas longitudinale a été menée par un universitaire et deux praticiens dans une PME de robotique. Les résultats montrent que l’impact de l’innovation ouverte est essentiellement positif pour la PME. Les fonctions de technological gatekeeper et de chargé de valorisation de projets d’innovation, créées lorsque le processus d’innovation ouverte a été mis en place, sont illustrées à travers des exemples de projets collaboratifs passés et d’un important projet de recherche européen en robotique, actuellement en cours, et dans lequel la PME est impliquée.
    Keywords: Inbound open innovation,outbound open innovation,innovation process implementation,SMEs,collaborative projects,Innovation ouverte entrante,innovation ouverte sortante,implémentation de processus d’innovation,PME,projets collaboratifs
    Date: 2017–04–06
  13. By: Andersson, Martin (Blekinge Institute of Technology); Larsson, Johan P. (Swedish Entrepreneurship Forum); Wernberg, Joakim (CIRCLE)
    Abstract: As cities increasingly become centers of economic growth and innovation, there is a need to understand their inner workings and organization in greater detail. We use ge-coded firm-level panel data at the sub-city level to assess the long-standing question whether agglomeration economies derive from specialization (within-industry) or diversity (between-industry). We show that these two types of externalities co-exist, but differ in their spatial distribution and attenuation within cities. There are robust positive effects of diversity and specialization on firms’ TFP growth at the local within-city neighborhood level, especially for firms in high-tech and knowledge-intensive activities. While specialization effects are bound to the local sub-city level, we demonstrate a positive effect of overall diversity also at the city-wide level. The results resonate with the idea that urban economies provide a mix of industrial diversity and specialisation. A location in a within-city industry cluster in a diversified, large city appears to let firms enjoy the benefits of local industry-specific externalities, while reaping the general city-wide benefits of a diversified city.
    Keywords: Productivity; Diversity; Specialization; Externalities; Knowledge spillovers; Attenuation; Agglomeration economies; Geocoding
    JEL: D24 L23 R12
    Date: 2017–05–10
  14. By: Michael Koch (University of Bayreuth, Germany); Marcel Smolka (Department of Economics and Business Economics, Aarhus University, Denmark)
    Abstract: Understanding the effects of foreign direct investment and the behavior of multinational enterprises (MNEs) is a core issue in the study of international economics. We exploit within-firm variation in ownership structure induced by foreign acquisitions in Spain to provide a new angle on the relationship among foreign ownership, technology, and skills. We first develop a model in which heterogeneous firms decide endogenously about the level of technology, the share of high-skilled workers, and the level of worker training. Foreign-owned firms implement better technology than domestically owned firms due to access to foreign markets through the foreign parent. This market size effect, coupled with a technology-skill complementarity, raises the demand for high-skilled workers as well as worker training upon acquisition. The largest productivity gains predicted by the model accrue to those firms that optimally combine better technology with a larger share of high-skilled workers in production and a better trained workforce. We test these predictions on a longitudinal data set of Spanish manufacturing firms. Combining firm fixed effects with a suitable propensity score weighting estimator, we find empirical evidence that foreign-acquired firms, not only increase their technology level, but also engage in skill upgrading upon acquisition (through both hiring and training). Moreover, we show that these changes are driven by the market size effect, and not by changes in the ownership structure per se. Finally, we reveal a technology-skill complementarity in the data implying that the productivity gains associated with better technology are magnified for firms actively engaging in skill upgrading. Overall, our paper provides strong evidence for the notion that foreign MNEs "inject" skill-biased technological change into their affiliated firms.
    Keywords: Multinational Enterprises, Mergers and Acquisitions, Skill-biased Technological Change, Worker Training Productivity
    JEL: D22 D24 F23 G34
    Date: 2017–05–23
  15. By: Kurakova, Natalia (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Zinov, Vladimir (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Tsvetkova, Liliya (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Kupriyanova, Olga (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: In the period 2014 to 2016 allocations for civil science decreased from 437.3 billion rubles to 285.8 billion rubles. In the context of the level of import dependence and the depreciation of the national currency, there has been more than a twofold reduction in the actual volume of science financing over the past three years. At the same time, the implementation of Presidential Decree No. 577 of May 7, 2012, implies bringing up to 200% of the average wage in the region of the salaries of research workers in 2018. However, as early as 2014, labor compensation in the academic organizations of the The Federal Agency for Scientific Organizations amounted to 75% of the volume of Current expenses. The paper analyzes the key problems of the distribution of the state budget in the sector of scientific knowledge and possible ways to increase their effectiveness. The review of the measures To optimize budget planning in the field of science proposed in 2014-2016 is carried out.
    Date: 2017–05
  16. By: Demary, Markus; Demary, Vera
    Abstract: Digitization affects all sectors of the economy. A new and possibly disruptive digital technology is the blockchain, a decentralized ledger, which seems to offer great promise for many financial and business applications.
    Date: 2017
  17. By: Jean-Marc Bourgeon (ECO-PUB - Economie Publique - INRA - Institut National de la Recherche Agronomique - AgroParisTech, Département d'Economie - Ecole Polytechnique - X); Margot Hovsepian (Département d'Economie - Ecole Polytechnique - X)
    Abstract: We analyze the adoption of green technology in a dynamic economy affected by random shocks where demand spillovers are the main driver of technological improvements. Firms' beliefs and consumers' anticipations drive the path of the economy. We derive the optimal policy of investment subsidy and the expected time and likelihood of reaching a targeted level of environmental quality under economic uncertainty. This allows us to estimate the value that should be given to the environment in order to avoid an environmental catastrophe as a function of the strength of spillover effects.
    Keywords: uncertainty,sustainability,Growth
    Date: 2017–04–18
  18. By: Requate, Till (Center for Mathematical Economics, Bielefeld University)
    Date: 2017–05–10
  19. By: Masatoshi Kato (School of Economics, Kwansei Gakuin University); Koichiro Onishi (Faculty of Intellectual Property, Osaka Institute of Technology); Yuji Honjo (Faculty of Commerce, Chuo University)
    Abstract: This study examines the role of patenting activities in new-firm survival, using a data set of firms founded from 2003 to 2010 in the Japanese manufacturing and software sectors. In particular, we distinguish the effects of patenting activities of chief executive officers (CEOs) from those of patenting activities of firms, taking into account exit routes: bankruptcy, voluntary liquidation, and merger. It is found that firms that engaged in patenting activities after start-up are less likely to go bankrupt. It is also found that firms whose CEOs have experience in patenting activities before start-up are less likely to go bankrupt. In contrast, we provide evidence that CEOs' involvement in patenting activities after start-up are not helpful for survival. Furthermore, the results based on subsamples according to firm age show that while firms' patenting activities do not increase the probability of survival in the early years since start-up, they help new firms surviving after a certain period of time since start-up. While CEOs' pre-entry patenting activities have a significant explanatory power in reducing the probability of bankruptcy within a certain period of time since start-up, they have no longer significant effect afterwards. Further, CEOs' patenting activities after start-up increase the probability of exit through bankruptcy and voluntary liquidation especially after a certain period of time since start-up.
    Keywords: New firm, patenting, chief executive officer, survival, firm age
    Date: 2017–05

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