nep-ino New Economics Papers
on Innovation
Issue of 2017‒07‒09
eighteen papers chosen by
Uwe Cantner
University of Jena

  1. R&D Policy Instruments: A Critical Review of What We Do & Don't Know By Ben R. Martin
  2. Why growth rates differ? Path of innovation in Italian provinces. By Michele Capriati; Marialuisa Divella
  3. Mobile Phone Innovation and Entrepreneurship in Sub-Saharan Africa By Simplice Asongu; Nicholas Biekpe
  4. The Locus of Knowledge Externalities and the Cost of Knowledge. By Antonelli, Cristiano; Colombelli, Alessandra
  5. The Engines of the Creative Response: Reactivity and Knowledge Governance. By Antonelli, Cristiano
  6. The Role of Patents in Information and Communication Technologies (ICTs). A survey of the Literature. By Stefano Comino; Fabio M. Manenti; NIkolaus Thumm
  7. Innovation and inequality in a small world By Lindner, Ines; Strulik, Holger
  8. International protection of intellectual property rights: a stochastic frontier index By José Fernández Donoso; Fernando Hernández
  9. Research, knowledge transfer and innovation: the effect of Italian universities’ efficiency on the local economic development 2006-2012 By Tommaso Agasisti; Cristian Barra; Roberto Zotti
  10. R&D Policy regimes in France: New Evidence from a spatio-temporal Analysis By Benjamin Montmartin; Marcos Herrera; Nadine Massard
  11. Show me the Money: Federal R&D Support for Academic Chemistry, 1990-2009 By Joshua L. Rosenbloom; Donna K. Ginther
  12. Firms' knowledge acquisition during dual-track VET: Which sources are important for innovativeness? By Christian Rupietta; Harald Pfeifer; Uschi Backes-Gellner
  13. The challenge of China’s rise as a science and technology powerhouse By Reinhilde Veugelers
  14. Smart Specialization policy in the EU: Relatedness, Knowledge Complexity and Regional Diversification By Pierre-Alexandre Balland; Ron Boschma; Joan Crespo; David L. Rigby
  15. Incentives to innovate under emission taxes and tradeable permits By Requate, Till
  16. Wage inequality and structural change By Joanna Tyrowicz; Magdalena Smyk
  17. Coalitional cohesion in technology policy: The case of the early solar cell industry in the United States By Ergen, Timur
  18. Determinants of technology catch-up in MENA and SSA countries: a panel data analysis By Francisco Serranito

  1. By: Ben R. Martin
    Abstract: In recent years, the term 'policy instrument' has been used more frequently with regard to R&D policy and innovation policy. What does this term mean? Where did it come from? What do we know about it, both with regard to the general field of policy studies but also in the specific context of R&D policy? This article examines the development of the notion of policy instruments as part of a body of research known as 'policy design'. Over the last 50 years, there has been substantial progress in setting policy design on a more systematic basis, with the development of established concepts and analytical frameworks, including various taxonomies of policy instruments. However, with just a few exceptions, this body of research seems to have had little impact in the world of R&D policy. The paper reviews the literature on R&D policy instruments. It identifies a number of challenges for R&D policy instruments in the light of four transitions – the shift from linear to systemic thinking about R&D and innovation, the shift from national governments to multi-level governance, the shift from individual actors to collaborations and networks, and the shift from individual policies to policy mixes. It sets out a research agenda for the study of R&D policy instruments, before ending with a number of conclusions.
    Keywords: Policy instruments; R&D policy; policy design; policy mix
    JEL: O38 I28 H11 D78 E61
    Date: 2015–12
  2. By: Michele Capriati (Università degli Studi di Bari Aldo Moro); Marialuisa Divella (Università degli Studi di Bari Aldo Moro)
    Abstract: This paper analyses the way in which innovation and absorptive capacity affect the productivity of Italian provinces. It builds on the Neo-Schumpeterian literature which investigates how technology gaps explain development disparities between countries and regions. The study is carried out at the provincial level, which allows a more fine-tuned analysis of the resource endowment linked to knowledge generation and economic performance. Moreover, it distinguishes between two very different types of innovation: those directly dependent on R&D and new knowledge generation which are generally measured by the number of patents; and those relying on the adaptation of processes, products and materials and thus mostly based on the exploitation of already existing knowledge, which are here measured by a new index based on registered utility models and industrial designs. Main results indicate a case of divergence in productivity levels instead of one of catching up among the Italian provinces; moreover, they suggest that the main effort to get productivity gains in this country has been carried out through a reduction of employment and of its related costs instead of via increasing R&D and human capital.
    Keywords: innovation, patents, utility models, industrial designs, provinces, proximity
    Date: 2017
  3. By: Simplice Asongu (Yaoundé/Cameroun); Nicholas Biekpe (Cape Town, South Africa.)
    Abstract: This study assesses how knowledge diffusion modulates the effect of the mobile phone on entrepreneurship in Sub-Saharan Africa with data for the period 2000-2012.The empirical evidence is based on interactive Generalised Method of Moments in which mobile phones are interacted with three knowledge diffusion variables, namely: education, internet penetration and scientific output. Ten variables of entrepreneurship are used. The following three main findings are established. First, the net effects from interacting mobile phones with the internet and scientific publications are negative whereas the corresponding net impact from the interaction between mobile phones and education is positive on the cost of doing business. Second, the mobile phone interacts with education (the internet) to have a positive (negative) net effect on the time needed to construct a warehouse whereas, the corresponding interaction with the internet yields a net negative effect on the time to enforce a contract. Third, there is a positive net effect from the interaction of mobile phones with education on the time to start a business. Given the construction of the education variable, the positive net effects from education are consistent with corresponding negative net effects from the other knowledge diffusion variables. The main policy implication is that mobile phone innovation (by means of internet penetration, scientific output and quality education) decreases constraints of entrepreneurship. Suggestions on how to boost these knowledge diffusion channels are discussed. Other practical and theoretical implications are also covered. To the best our knowledge, this is the first inquiry to assess the relevance of mobile phone innovation in entrepreneurship in Sub-Saharan Africa.
    Keywords: Entrepreneurship; the Mobile Phone; Knowledge Diffusion; Sub-Saharan Africa
    JEL: L59 L98 O10 O30 O55
    Date: 2017–05
  4. By: Antonelli, Cristiano; Colombelli, Alessandra (University of Turin)
    Abstract: This paper provides an extended CDM approach to analyse jointly the simultaneous effects of knowledge spillovers in the knowledge generation function and in the technology production function. It introduces the distinction between imitation and knowledge externalities and articulates the hypothesis that spillovers yield their effects via three well distinct mechanisms: i) knowledge externalities that exert positive and direct effects on the knowledge production function, and ii) indirect effects on the technology production function via their effects on the cost of knowledge; iii) imitation externalities exert direct and positive effects on productivity in the technology production function. We test our hypotheses on a large panel of Italian companies distributed in the NUTS2 regions for the period 2005 – 2009. The econometric analysis consists in a model comprising a system of equations that test the simultaneous role of spillovers in the knowledge generation function and the technology production function with the inclusion of endogenous knowledge costs. The results confirm that the access to external knowledge – as an input in the knowledge generation function – plays a key role in increasing the knowledge output and – as an input in the technology production function – has positive indirect and direct effects on the productivity of firms.
    Date: 2017–06
  5. By: Antonelli, Cristiano (University of Turin)
    Abstract: The notion of endogenous innovation as the outcome of the creative response of firms to out-of-equilibrium conditions is the cornerstone of the new evolutionary complexity. This essay explores the role of the reactivity of firms to out-of-equilibrium conditions and of knowledge governance in assessing the chances that creative responses actually take place as an alternative to adaptive responses. It implements a systemic frame able to show that: i) the levels of reactivity of firms enhance the research efforts of rims that try and cope with out of equilibrium conditions; ii) the actual rates of introduction of innovations and increase of total factor productivity are contingent upon the quality of knowledge governance, and iii) out-of-equilibrium conditions, as well as the amount of knowledge externalities are the endogenous outcome of the creative response.
    Date: 2017–06
  6. By: Stefano Comino (Univeristy of Udine); Fabio M. Manenti (University of Padova); NIkolaus Thumm (European Commission JRC Seville)
    Abstract: During the last decades, the number of ICT related patents has increased considerably. In association with a great fragmentation in IP rights, the increasing number of patents has generated a series of potentially problematic consequences. Patent thickets, royalty stacking, the emergence of patent assertion entities, increased patent litigation – in particular around standard essential patents – and the difficulties in the definition of fair, reasonable and non-discriminatory (FRAND) licensing terms are among the most debated issues in the literature that we review in this paper. We devote a specific section of our survey to patents involving software products, where the above problems are amplified by the high level of abstraction of computer algorithms. In our analysis we mix theoretical and empirical arguments with a more policy-oriented reasoning. This allows us to better position the different issues in the relevant political and economic context.
    Date: 2017–06
  7. By: Lindner, Ines; Strulik, Holger
    Abstract: We present a multi-country theory of economic growth and R&Ddriven technological progress in which countries are connected by a network of knowledge exchange. Technological progress in any country depends on the state of technology in the countries it exchanges knowledge with. The diffusion of knowledge throughout the world explains a period of increasing world inequality after the take-off of the forerunners of the industrial revolution, followed by decreasing relative inequality. Knowledge diffusion through a Small World network produces an extraordinary diversity of country growth performances, including the overtaking of individual countries and the replacement of the technologically leading country in the course of world development.
    Keywords: networks,knowledge diffusion,economic growth,world income distribution
    JEL: O10 O40 D85 F43
    Date: 2017
  8. By: José Fernández Donoso; Fernando Hernández (School of Business and Economics, Universidad del Desarrollo)
    Abstract: This paper combines two bodies of work: the literature regarding the measurement of the strength of intellectual property rights (IPR) protection systems and stochastic production frontier efficiency analysis. We propose measuring the efficiency of IPR protection systems by comparing optimal production frontier of innovation to real results, through a measure based on the existing Stochastic Frontier Analysis of technical efficiency. Our results indicate that, despite imperfect datasets, this approach provides interesting results comparable to measures in Park (2008) and other IPR strength indicators. Some issues to be further explored longer datasets and richer information, and innovation measurements. This paper also adds some evidence to the idea of an inverted U relationship between innovation output and IPR protection system strength.
    Keywords: Intellectual property, Innovation, Global Innovation Index, Patent applications, Economic development, Stochastic frontier analysis, Fixed effects
    Date: 2017–05
  9. By: Tommaso Agasisti (Politecnico di Milano School of Management); Cristian Barra (Università di Salerno); Roberto Zotti (Università di Salerno)
    Abstract: In this paper, we test whether there is a link between the performance of universities and the local economic development of the territory where they operate. The performance of academic institutions is measured through an efficiency concept, estimated by means of an innovative Stochastic Frontier Analysis (SFA), and considering indicators of teaching, research and ‘third mission’ as outputs. A system generalized method-of-moments (Sys- GMM) dynamic panel estimator, instrumented with time lags and differences is estimated over the period from 2006 to 2012 to solve the potential endogeneity of the explanatory variables. Our findings reveal that the presence of efficient universities fosters local economic development, and that knowledge spillovers occur between areas through the geographical proximity to the efficient universities.
    Keywords: Higher education; knowledge spillovers; local economic development; efficiency of universities
    JEL: I21 E01
  10. By: Benjamin Montmartin (UniversitŽ C™te dÕAzur, France; GREDEG CNRS); Marcos Herrera (CONICET - IELDE; National University of Salta, Argentina); Nadine Massard (GAEL UMR 1215; UniversitŽ Grenoble Alpes, France)
    Abstract: Using a unique database containing information on the amount of R&D tax credits and regional, national and European subsidies received by firms in French NUTS3 regions over the period 2001-2011, we provide new evidence on the efficiency of R&D policies taking into account spatial dependency across regions. By estimating a spatial Durbin model with regimes and fixed effects, we show that in a context of yardstick competition between regions, national subsidies are the only instrument that displays total leverage effect. For other instruments internal and external effects balance each other resulting in insignificant total effects. Structural breaks corresponding to tax credit reforms are also revealed.
    Keywords: Additionality, French policy mix, R&D investment, Spatial panel, Structural break
    JEL: H25 O31 O38
    Date: 2017–06
  11. By: Joshua L. Rosenbloom; Donna K. Ginther
    Abstract: We examine the distribution of Federal support for chemistry Research and Development (R&D) performed at U.S. universities from 1990-2009. Federal R&D funding is an essential source of funds for investigator-driven research at the nation’s universities. Previous studies have documented that aggregated federal R&D funding has become more dispersed over time and attributed this to political pressure to spread resources more evenly. There have, however, been few studies of the allocation of funds within narrowly defined scientific disciplines. By narrowing the focus and exploiting the panel nature of our data we are better able to analyze the correlates of funding variation, yielding a number of new insights not apparent in studies using more aggregated data. First, we find that R&D expenditures at the discipline level are considerably more volatile than aggregate funding. Second, we show a strong positive association between several measures of institutional research capacity and future funding. In particular, we find a positive association between the employment of postdoctoral researchers and higher future research funding.
    JEL: I23 O3 O32
    Date: 2017–06
  12. By: Christian Rupietta (University of Wuppertal); Harald Pfeifer (Federal Institute for Vocational Education and Training (BIBB)); Uschi Backes-Gellner (University of Zurich)
    Abstract: Researchers debate for more than 3 decades on the effect of vocational training on innovations. While some studies show a negative effect of vocational education that firms organize on its own, other studies show a positive effect for vocational education that is organized on a sectoral or national level such as in Germany or Switzerland. A characteristic of these vocational education and training (VET) systems is a high level of standardization and regulation. In fact many elements of VET are regulated in national law, training ordinances and curricula, but firms nevertheless less still have a high flexibility when it comes to the organization of workplace training. In this paper we analyze how firms organize their workplace training, which training methods they use and which training methods they apply jointly. As each training method e.g. training during work or external courses, transfers a specific set of skills and knowledge to apprentices, we analyze how firms use training methods to promote their innovation activity. Our results show that there is a large variety in the organization of workplace training. In sum firms make use of the flexibility to design workplace training that fits their needs best. We conclude with implications for the design of VET systems and firms.
    Keywords: Learning Modes, Innovation, Vocational Education, fsQCA, negative binomial regression
    Date: 2017–07
  13. By: Reinhilde Veugelers
    Abstract: China is building up its global competitiveness in knowledge-intensive sectors and its ambition to be a global leader in science and innovation by 2050 seems well within reach. China outperforms the European Union in terms of expenditure on research and development as a share of its GDP, and already produces about the same number of scientific publications, and more PhDs in natural sciences and engineering, than the United States. China aspires to produce and capitalise on home-grown scientific talent, but its growth model for science still involves sending out its increasingly better locally-trained scholars to the best institutes in the world and reaping the benefits when they return in the later stages of their careers, after they have fully developed their capabilities and built their networks. The US remains the favoured destination for Chinese students, which has led to the creation of US-Chinese science and technology networks and connections that are mutually beneficial - enabling China to catch up and helping the US to keep its position at the science frontier. The EU has much less-developed scientific connections to China than the US. The EU should take steps to engage more with China if it is not to miss out in the future multipolar science and technology world.
    Date: 2017–07
  14. By: Pierre-Alexandre Balland; Ron Boschma; Joan Crespo; David L. Rigby
    Abstract: Smart specialization has become a hallmark of the EUÕs Cohesion Policy. Envisaged as a bottom-up initiative identifying local knowledge cores and associated competitive advantages, the operationalization of smart specialization has been rather limited, as a coherent set of analytical tools to guide the policy directives remains elusive. To tackle the weak underpinning of smart specialization policy, we propose a policy framework around the concepts of relatedness and knowledge complexity. We use EPO patent data to provide evidence on how EU regions develop new technologies in the period 1990-2009. We find that diversifying into more complex technologies is highly attractive but difficult for EU regions to accomplish. Regions can overcome this diversification dilemma by developing new complex technologies that build on local related capabilities. We use these findings to construct a policy framework for smart specialization that highlights the potential risks and rewards for regions of adopting competing diversification strategies. We show how potential costs of alternative strategies in regions may be assessed by making use of the relatedness concept, and how potential benefits of various smart specialization strategies can be derived from estimates of the complexity of technologies. A series of case-studies of different types of regions illustrate the utility of this policy framework. Length:
    JEL: O25 O38 R11
    Date: 2017–07
  15. By: Requate, Till (Center for Mathematical Economics, Bielefeld University)
    Date: 2017–04–04
  16. By: Joanna Tyrowicz (Group for Research in Applied Economics (GRAPE); University of Warsaw); Magdalena Smyk (Group for Research in Applied Economics (GRAPE))
    Abstract: Income inequality in the context of large structural change has received a lot of attention in the literature, but most studies relied on household post-transfer inequality measures. This study utilizes a novel and fairly comprehensive collection of micro datasets between 1980s and 2010 for both advanced market economies and economies undergoing transition from central planning to market based system. We show that earned income inequality was initially lower in transition economies and immediately upon the change of the economic system surpassed the levels observed in advanced economies. We decompose changes in wage inequality into parts that can be attributed to changes in characteristics (mainly education) and changes in rewards, but did not find any leading factor. Finally, in the context of skill-biased technological change literature we find a very weak link between structural changes and wages in both advanced and post-transition economies. %This holds regardless of whether an economy has underwent a large structural shock or not.
    Keywords: wage inequality, structural change, transition, skill biased technological change
    JEL: E24 D31 N34 O57 P36 P51
    Date: 2017
  17. By: Ergen, Timur
    Abstract: The paper traces the rise and decline of solar cell commercialization efforts during the 1970s and early 1980s in the United States. It shows how technology policies for photovoltaic appliances gained and lost support in a time of increasing uncertainty about future resource supplies and the future of energy provision. Contrary to conventional explanations of the long history of failures to commercialize renewable energy technologies that emphasize path dependencies around established energy technologies, this paper explains the rise and decline of early solar cell policies from the perspective of internal sectoral developments. It demonstrates that cohesion among political economic supporters was critical for public perceptions of the intermediary success of the effort, to continuous investment by industry, and to the maintenance of political support. The paper suggests that support for new industries and technologies is dependent on sectoral order among supporting groups over time. The case of the early photovoltaics policies illustrates how the failure to keep groups unified and committed undermined the implementation of the technology policies, weakened the credibility of the developmental effort, and ultimately led to a decline in political support. The paper contributes to recent debates about the conditions of successful industrial and technology policies by demonstrating that network failures have an important political dimension if ruptures of sectoral cooperation feed back on state support for the respective industry or technology.
    Keywords: technology policy,renewable energy,institutional change,governance,innovation,Technologiepolitik,erneuerbare Energien,institutioneller Wandel,Governance,Innovation
    Date: 2017
  18. By: Francisco Serranito (Centre d'Economie de l'Université de Paris Nord (CEPN))
    Abstract: This paper aims at testing the determinants of TFP in the case of a panel of African and Middle-East countries for the period 1970-2010. We get two main results. Firstly, the degree of openness of a country is the only variables that have a positive and robust effect on the TFP growth. Secondly, convergence is not an automatic phenomenon for all countries. The possibility of a convergence effect depends on the ability of countries to adopt foreign technology. The absorptive capacity depends on the stock of human capital and the degree of financial market development.
    Keywords: Technology gap, Catching-up, Dynamic Panel Data, GMM estimation, Middle-East and North Africa, Sub-Saharan African countries
    JEL: I2 O1 O3 O4
    Date: 2017–06

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