nep-ino New Economics Papers
on Innovation
Issue of 2020‒01‒13
eight papers chosen by
Uwe Cantner
University of Jena

  1. A multi-sector model of relatedness, growth and industry clustering By Steven Bond-Smith; Philip McCann
  2. AI and Robotics Innovation: a Sectoral and Geographical Mapping using Patent Data By Van Roy, Vincent; Vertesy, Daniel; Damioli, Giacomo
  3. Creativity as a Competitive Entrepreneurial Enabler By Fascia, Michael; fascia, sonny
  4. Learning Before and After the Global Crisis: Firm-level Innovation in Latin America By King Yoong Lim; Diego Morris
  5. Core strength or Achilles’ heel : Organizational competencies and the performance of R&D collaborations By de Groot, Harmke
  6. DECLINING BUSINESS DYNAMISM By Gert Bijnens; Joep Konings
  7. Governance Mechanisms Enabling Inter-Organizational Adaptation: Lessons from Grand Challenge R&D Programs By Hayter, Christopher; Link, Albert
  8. Global networks, local specialisation and regional patterns of innovation By Andrea Ascani; Luca Bettarelli; Laura Resmini; Pierre-Alexandre Balland

  1. By: Steven Bond-Smith (Bankwest Curtin Economic Centre, Curtin University); Philip McCann (Faculty of Spatial Sciences, University of Groningen)
    Abstract: This article builds an understanding of regional innovation specialization by developing a multi-sector model with endogenous growth through quality improving innovations and spillovers from related technologies. The model provides an approach to incorporate the relatedness literature within the mainstream theoretical frameworks of endogenous growth and economic geography. Each firm’s technology sector and the location of other firms play a role in each firm’s ability to improve its own technology. As a result, firms prefer to co-locate in technologically compatible clusters. Without relying on scale assumptions, the model for the first time coherently links related variety knowledge spillovers to mainstream urban economic frameworks and demonstrates that clustering is possible in both core and peripheral areas.
    Keywords: Innovation; endogenous growth; knowledge spillovers; relatedness; clusters
    JEL: R11 O41
    Date: 2019–09
  2. By: Van Roy, Vincent; Vertesy, Daniel; Damioli, Giacomo
    Abstract: Economic activities based on the invention, production and distribution of artificial intelligence (AI) technologies have recently emerged worldwide. Yet, little is known about the innovative activities, location and growth performance of AI innovators. This chapter aims to map and analyse the global innovative landscape of AI by exploring 155,000 patents identified as AI-related by means of text-mining techniques. It highlights the emergence and evolution of AI technologies and identifies AI hotspots across the world. It explores the scale and pervasiveness of AI activities across sectors, and evaluates the economic performance of AI innovators using firm accounting information. Finally, it assesses recent trends in venture capital investments towards AI as financial support to promising AI startups. Findings of this chapter reveal a tremendous increase in AI patenting activities since 2013 with a significant boom in 2015-2016. While most of AI patenting activities remain concentrated in the sectors of software programming and manufacturing of electronic equipment and machinery, there are clear signs of cross-fertilisation towards (non-tech) sectors. The market of AI patenting firms is very vibrant and characterised by a large increase of new and small players with economic performances above industry average. This trend is also reflected by the recent increase in venture capital towards AI startups.
    Keywords: Artificial intelligence,innovation,patents,robotics
    JEL: O31 O33
    Date: 2019
  3. By: Fascia, Michael; fascia, sonny
    Abstract: Interest in business management thinking and innovation has continued to grow during recent decades. The Scottish Government identifies that a large proportion of new and start up businesses fail within the first 2 years. Consequently, there are many areas for the start-up entrepreneur to get information and help, nonetheless the trend remains. This study offers an alternative method for deciding on intrinsic success factors by outlining the relationship between business start-ups, creativity, and innovation. The focus was on creativity, as an entrepreneurial characteristic, links or effects the start-up capability of the entrepreneur. The study used a qualitative method to interpret this complexity and this became more apparent as the study progresses since innovation and innovation which supports a business start-up assume holistic, flux-like and complex concepts. Four main themes emerged from the thematic data analysis; Leadership; Ability to Change; Creativeness and Collaboration. Findings from the study indicate that business management thinking and innovation underpinned by perspective themes, help the entrepreneur see and appreciate the complex multi-faceted interactions of innovation, perhaps better than an average person. However, actual definition of the precise mechanisms needed to support business start-ups drawn from creativity were difficult to establish. In conclusion, the study has to say that while elements of creativity were present with each of the entrepreneur and were clearly significant to the success of the start up, it would seem very difficult to actually identify if there is such a thing as a guaranteed creativity template for success.
    Date: 2019–02–27
  4. By: King Yoong Lim; Diego Morris
    Abstract: Economic shocks of the kind we recently witnessed with the 2008 global financial and economic crisis do not come around very often but when they do, their effect can be catastrophic, not the least because of their impact on businesses. Existing theories of how firms react to crises such as these are ambiguous and very little empirical evidence exist, particularly for the developing world. As such, our main contribution to the literature is to shed light on these issues, articulating a theoretical framework and testing it using three waves of cross-country innovation identifying survey implemented by the World Bank in Latin American economies. The three waves coincide with a timespan that covers before, during, and after the global crises. Our results provide strong support that firms alter their practices and witness different profit outcomes before and after a downturn depending on innovation decisions. In fact, we find evidence that indicates that the profitability gains from new products for firms may be higher during downturns.
    Keywords: Economic crisis, Innovation, Latin America, Productivity.
    JEL: D22 D24 O30 O31
    Date: 2020–01
  5. By: de Groot, Harmke (Tilburg University, School of Economics and Management)
    Abstract: The three essays collected in this dissertation advance our understanding of how organizational competencies and R&D objectives are related with partner selection and R&D performance at the project level. The first essay shows how the organizational competencies and R&D prime objective of the focal firm are related with who is seen as the most important partner in the R&D project. The second essay examines how organizational competencies affect the innovation performance of companies when collaborating with an external R&D organization. The third essay focuses on the relationship of absorptive capacity and knowledge distance with new product development performance.
    Date: 2019
  6. By: Gert Bijnens; Joep Konings
    Abstract: We build on Decker et al. (2016) who show that business dynamism and entrepreneurship in the U.S. have declined over recent decades and that the characteristics of this decline changed around 2000. Since 2000 the U.S. decline in dynamism has been accompanied by a decline in high-growth, young firms. Using 30 years of data from all for-profit firms incorporated in Belgium, we now offer evidence that Belgium, a far more rigid economy than the U.S., experienced a similar decline in dynamism. Furthermore, the decline set in around 2000 as well. We attribute this not only to the declining share of young firms that become high-growth firms, but more importantly also to the declining propensity for small (not necessarily young) firms to experience fast growth. We do not yet know what caused this decline. Since there are remarkable similarities between Belgium and the U.S. with respect to the secular decline in business dynamism, global trends rather than country specific changes are most likely to be at the basis of this evolution. A possible global trend causing dynamism to decline, is the ICT revolution that started the second half of the ’90s. We find preliminary indications that industries with higher ICT intensity have experienced a dynamism trend change during that same period and show a steeper dynamism decline.
    Date: 2018–01
  7. By: Hayter, Christopher (Arizona State University); Link, Albert (University of North Carolina at Greensboro, Department of Economics)
    Abstract: From climate change to terrorism, the world is confronting complex, trans-national problems. As a contemporary response, governments and non-profit organizations have established grand challenge programs, consisting of multi-sector research and development partnerships, to access innovative new ideas and rapidly scale solutions. Following recent scholarly contributions, this paper investigates how problems motivating program establishment were identified, how these problems and related contextual factors evolve over time, and how grand challenge programs evolve in response. It does so through a multi-year study of 10 grand challenge programs that differ substantially in purpose and organization. The paper finds that adaptive capabilities--inter-organizational governance mechanisms--and operational aspects such as purpose, scope, temporal factors, and partner capabilities are critical to program evolution and impact.
    Keywords: Grand Challenges; R&D Partnernships; Governance; Innovation Policy;
    JEL: L22 O31 O35
    Date: 2020–01–06
  8. By: Andrea Ascani; Luca Bettarelli; Laura Resmini; Pierre-Alexandre Balland
    Abstract: A large academic consensus exists on the idea that successful innovative processes are geographically bounded within regions. Nevertheless, the ability of regions to capture and re-use external knowledge is also regarded as a fundamental element to sustain and refine the local profile of specialisation and competitiveness. The present article combines these views to investigate the sources of the regional innovation process, by analysing data on Italian regions over the period 2007-2012. We define regional external networks based on all the foreign subsidiaries of local multinational enterprises identifiable as global ultimate owners. Our main results suggest that both the internal specialisation and the outward networks can generate indigenous innovation, but the role of the networks varies substantially according to its density, its degree of complementarity with the specialisation profile, its geographical spread and the specific location of the foreign subsidiaries. Our results, then, support a view of the regional innovation as an interactive process whereby valuable knowledge resources are not only generated within the reach of the local economy, but they are also integrated with external inputs. This contrasts with recent anti-globalisation views according to which the increase in the foreign operations of national companies impoverishes the local economy.
    Keywords: outward foreign direct investment, innovation, specialisation, networks, relatedness
    JEL: O3 F23 R10 F60
    Date: 2020–01

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