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on Innovation |
| By: | Oscar Mauricio Valencia-Arana (Banco de la República de Colombia); Jose Eduardo Gomez-Gonzalez (Banco de la República de Colombia); Andrés Garcia-Suaza (Universidad del Rosario) |
| Abstract: | Can technological misallocation generate financial frictions? We build a theoretical model with testable implications, in which the misallocation between R&D and production activities generates borrowing constraints. The investor offers the innovator a rent that is contingent to the success of its project in order to make them exert an incentive-compatible effort level. However, this rent distorts the allocation of effort between activities. Specifically, it leads to a suboptimal level of effort impulsing a reallocation of resources from production to R&D. Consequently, the investor cannot appropriate the surplus resulting from innovation. This distortion increases the cost of external financing for firms that have large amount of intangible assets. Using Compustat data for manufacturing firms in the United States between 1982 and 2007, we show that cash-flow sensitivities are positive and increasing in firms with high R&D intensities. Classification JEL: G11, 033, D86 |
| Keywords: | Moral Hazard, Endogenous Borrowing Constraints, and Technological Misallocation |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:bdr:borrec:1004&r=ino |
| By: | Masatoshi Kato (School of Economics, Kwansei Gakuin University) |
| Abstract: | This study explores the role of founders f human capital in determining the external knowledge sourcing (licensing-in and joint R&D) of a firm during the start-up period using panel data drawn from original questionnaire surveys conducted in Japan. The results of a probit model with an endogenous regressor show that firms managed by founders with a high level of specific human capital, measured as prior work experience in a related field or as technological experience, tend to engage in external knowledge sourcing because of their absorptive capacity. The findings indicate that this type of human capital also promotes R&D investment. Contrariwise, this study finds that firms managed by founders with a high level of general human capital, measured as educational attainment, tend to invest more in R&D as an absorptive capacity-building activity, which may promote external knowledge sourcing. The implications of these findings are discussed from the perspective of economic policy. |
| Keywords: | Start-up, Founder, General human capital, Specific human capital, R&D investment, External knowledge sourcing. |
| JEL: | M13 L26 O32 |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:kgu:wpaper:162&r=ino |
| By: | Ivan D. Breslavsky |
| Abstract: | In this paper, the agent-based modeling is employed to model the effect of intellectual property policy at the speed of technological advancement. Every agent has inborn preferences towards investing their capital into independent technological development, innovation appropriation, and production. The relative cost of appropriation compared to independent development is chosen as a measure of strictness of intellectual property protection. We vary this parameter and look at the performance of agents with different preferences and overall technological progress. In general, it is found that in the specific setting considered with stronger intellectual property protection leads to faster progress. |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1706.04518&r=ino |
| By: | Florida, Richard (University of Toronto); Mellander, Charlotta (Jönköping University & Centre of Excellence for Science and Innovation Studies (CESIS)) |
| Abstract: | Our research examines the role of innovation and skill on the level economic segregation across U.S. metro areas. On the one hand, economic and urban theory suggest that more innovative and skilled metros are likely to have higher levels of economic segregation. But on the other hand, theory also suggests that more segregated metros are likely to become less innovative over time. We examine the connection between innovation and economic segregation this via OLS regressions informed by a Principal Component Analysis to distill key variables related to innovation, knowledge and skills, while controlling for other key variables notably population size. Our findings are mixed. While we find evidence of an association between the level of innovation and skill and the level of economic segregation in 2010, we find little evidence of an association between the level of innovation and skill across metros and the growth of economic segregation between 2000 and 2010. |
| Keywords: | Economic segregation; inequality; innovation; high-tech; skill; talent; human capital |
| JEL: | J24 O30 R23 |
| Date: | 2017–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0456&r=ino |
| By: | van de Vrande, V.J.A. |
| Abstract: | Today’s business environment is characterised by fast and frequent change, which is often difficult to predict. As a consequence, companies need to continuously invest in the development of new business to remain competitive. However, due to the increasing complexity of the environment, internal development is often not enough, and collaborative innovation is becoming more important. There are three areas that warrant our attention. First, interest among employees and organisations to pursue entrepreneurial initiatives raises questions around the management and support that is needed to foster these initiatives and how to best organise internal corporate venturing. Second, the increasing number of start-ups provides opportunities for existing companies to tap into emerging technologies and business areas through corporate – start-up collaboration. Third, the changing nature of work provides an opportunity for existing organisations to rethink the relationship they have with their employees and to find a way to benefit from the increased flexibility of their own and other’s workers. I will raise a number of research questions in these areas and provide directions for future research in the field. |
| Keywords: | Entrepreneurship, Corporate venturing, Corporate venture capital, Collaboration, Innovation, Coworking, Start-ups |
| JEL: | M D21 L20 O31 |
| Date: | 2017–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:ems:euriar:100028&r=ino |
| By: | Fabio Lamantia; Mario Pezzino |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:man:sespap:1708&r=ino |
| By: | Allan Dahl Andersen (TIK Center for Technology, Innovation and Culture, University of Oslo, Norway); Jochen Markard (Swiss Federal Institute of Technology Zurich (ETH Zurich), Switzerland) |
| Abstract: | It is a classic theme in the transitions literature that newcomers supporting a novel technology struggle for dominance against incumbent actors and ‘their’ established technologies. Our study challenges this picture in several aspects with the intention to improve conceptual frameworks in transition studies. We present a case study on high voltage direct current (HVDC) technology - a mature technology for electricity transmission that has remained in a niche for decades but recently gained new momentum in the course of the energy transition. This case highlights i) incumbent actors as key drivers for innovation, ii) coupled dynamics via interaction of multiple technologies, also across industry boundaries, as a central process in transition dynamics, and iii) the increasingly pervasive nature of the energy transition. We interpret our observations from the perspective of two established frameworks, technological innovation systems and the multi-level perspective, and discuss implications for conceptual refinement. |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:tik:inowpp:20170612&r=ino |
| By: | Juan Jung (AQR-IREA, Universitat de Barcelona, Av. Diagonal 690, 08034 Barcelona, Spain.); Enrique López-Bazo (AQR-IREA, Universitat de Barcelona, Av. Diagonal 690, 08034 Barcelona, Spain.); Matteo Grazzi (Competitiveness, technology and innovation division - Inter-American Development Bank, 1300 New York Avenue, NW 20577 Washington DC, USA.) |
| Abstract: | This paper tests three hypotheses regarding the link between internet and firm productivity: i) internet adoption and use constitute a source of productivity growth for firms in Latin America, ii) the intensity of its use also matters, and iii) the link between the new technologies and productivity levels is not uniform over the whole productivity distribution. The evidence in this paper fills the gap of scarce and fragmented literature focused on Latin America, and is aligned with previous research for more developed regions which has generally recognized that Information and Communication Technologies (ICTs) have radically changed how modern business are conducted, benefitting firm performances through several channels, such as increasing the efficiency of internal processes, expanding market reach or increasing innovation. Our findings suggest that low-medium productive firms benefit more from an expansion in internet adoption and use, in comparison with the most productive ones. If this evidence is supposed to reflect long-term effects, then public policies oriented to massify internet adoption and promote internet use intensively will surely contribute to reduce inequalities of enterprise’s productivity levels, promoting a level playing field among Latin American firms, something especially relevant for the most unequal region of the world. |
| Keywords: | ICT, Internet, Productivity, firms, Latin America JEL classification:D22, O31, O33, O54. |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201709&r=ino |
| By: | Jaime Alonso-Carrera (Universidade de Vigo); María Jesús Freire-Serén (Universidade de Vigo); Xavier Raurich (Universitat de Barcelona) |
| Abstract: | We characterize several possible mechanisms of structural change by using a general multisector growth model, where preferences and technologies are not parameterized. In this generic set up, we derive the growth rates of sectoral employment shares at the equilibrium. We find that the economic fundamentals governing structural change in the sectoral employment shares are: (i) the income elasticities of the demand for consumption goods; (ii) the Allen-Uzawa elasticities of substitution between consumption goods; (iii) the capital income shares in sectoral outputs; and (iv) the elasticity of substitution between capital and labor in each sector. These fundamentals determine the effect that the growth rates of aggregate income, relative prices, rental rates and technological progress have on structural change. Finally, we estimate the aforementioned fundamentals to develop an accounting exercise that quantifies the contribution of each mechanism to the U.S. structural change. |
| Keywords: | Structural change, structural transformation, non-homothetic preferences, sectoral productivity |
| JEL: | O11 O41 O47 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ewp:wpaper:360web&r=ino |
| By: | Sara Amoroso (European Commission - JRC); Bettina Mueller (Centre for European Economic Research (ZEW)) |
| Abstract: | Existing evidence on the impact of foreign direct investment on domestic economies remains ambiguous. Positive technology spillovers of foreign investment may be outweighed by negative crowding out effect due to increased competition. In this paper, we employ a unique country/sector-level data set to investigate the impact of what is considered the best type of foreign investment greenfield knowledge intensive FDI on domestic entry. Our results suggest that, in the short run, this type of FDI is positively related to the entry rate in the host country, if the domestic sector is either dynamic, or highly R&D intensive. These sectors may be respectively characterized by lower entry costs, which encourage a trial and error learning business approach, and by a higher level of absorptive capacity which increases the chance of technology transfer. |
| Keywords: | foreign direct investments; knowlwdge spillovers; new firm entry |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:wpaper:201702&r=ino |
| By: | Samuele Centorrino; Frédérique Fève; Jean-Pierre Florens |
| Abstract: | We present a review on the implementation of regularization methods for the estimation of additive nonparametric regression models with instrumental variables. We consider various versions of Tikhonov, Landweber-Fridman and Sieve (Petrov-Galerkin) regularization. We review data-driven techniques for the sequential choice of the smoothing and the regularization parameters. Through Monte-Carlo simulations, we discuss the finite sample properties of each regularization method for different smoothness properties of the regression function. Finally, we present an application to the estimation of the Engel curve for food in a sample of rural households in Pakistan, where a partially linear specification is described that allows one to embed other exogenous covariates. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:nys:sunysb:17-06&r=ino |
| By: | Marchese, Carla; Marsiglio, Simone; Privileggi,Fabio; Ramello, Giovanni B. (University of Turin) |
| Abstract: | We show that, even in a framework in which monopolistic exploitation of patents does not occur, patents still give rise to serious drawbacks. We build on Weitzman’s (1998) recombinant growth model which provides a stylized but clear description of the formation of knowledge externalities. In our framework a benevolent government buys immediately new patents in a competitive market and releases their contents for free. We show that inefficiencies nevertheless arise and welfare can be improved by correcting the market price through a tax-subsidy scheme. We characterize the (asymptotic) steady state equilibrium, and some properties of the transitional path. We show that if certain conditions are met, then the economy will converge to its (asymptotic) balanced growth path, and along such a path growth will be independent of the policy parameter; conversely, transition dynamics are affected by the choice of the policy parameter. We then quantitatively analyze the effect of different policy interventions on welfare, and show that stricter tax (weaker appropriability) regimes lead to higher social welfare. |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:uto:dipeco:201720&r=ino |
| By: | Cozzi, Guido; Galli, Silvia |
| Abstract: | Basic research is mainly performed publicly. Yet in the US public research findings were not patentable until 1980, and in other countries are not yet patentable. Patentability renders public research more directed, with less potential waste, but it also restricts private applied research. This paper shows, by means of a multi-stage Schumpeterian growth model, that in the long run the first effect is bound to dominate. |
| Keywords: | R&D and Growth; Sequential Innovation; Public R&D; Patent Laws; Bayh-Dole Act. |
| JEL: | H4 O3 |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:79622&r=ino |
| By: | Niko Jaakkola; Frederick van der Ploeg |
| Abstract: | Global warming can be curbed by pricing carbon emissions and thus substituting fossil fuel with renewable energy consumption. Breakthrough technologies (e.g., fusion energy) can reduce the cost of such policies. However, the chance of such a technology coming to market depends on investment. We model breakthroughs as an irreversible tipping point in a multi-country world, with different degrees of international cooperation. We show that international spill-over effects of R&D in carbon-free technologies lead to double free-riding, strategic over-pollution and underinvestment in green R&D, thus making climate change mitigation more difficult. We also show how the demand structure determines whether carbon pricing and R&D policies are substitutes or complements. |
| Keywords: | global warming, carbon pricing, renewable R&D, tipping point, international cooperation, non-cooperative policies, feedback Nash equilibrium |
| JEL: | D2 D90 H23 Q35 Q38 Q54 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:oxcrwp:190&r=ino |