nep-ino New Economics Papers
on Innovation
Issue of 2023‒09‒04
four papers chosen by
Uwe Cantner, University of Jena

  1. A new mapping of technological interdependence By A. Fronzetti Colladon; B. Guardabascio; F. Venturini
  2. Tariffs and Innovation in a Schumpeterian Economy with North-South Technology Transfer By Ho, Florence Ut Meng
  3. Private and Public Sector Interactions That Encourage Growth-Creating Technological Advance By Richard G. Lipsey
  4. Digitalisation in European regions: Unravelling the impact of relatedness and complexity on digital technology adoption and productivity growth By Stefan Apostol; Eduardo Hernández-Rodríguez

  1. By: A. Fronzetti Colladon; B. Guardabascio; F. Venturini
    Abstract: Which technological linkages affect the sector's ability to innovate? How do these effects transmit through the technology space? This paper answers these two key questions using novel methods of text mining and network analysis. We examine technological interdependence across sectors over a period of half a century (from 1976 to 2021) by analyzing the text of 6.5 million patents granted by the United States Patent and Trademark Office (USPTO), and applying network analysis to uncover the full spectrum of linkages existing across technology areas. We demonstrate that patent text contains a wealth of information often not captured by traditional innovation metrics, such as patent citations. By using network analysis, we document that indirect linkages are as important as direct connections and that the former would remain mostly hidden using more traditional measures of indirect linkages, such as the Leontief inverse matrix. Finally, based on an impulse-response analysis, we illustrate how technological shocks transmit through the technology (network-based) space, affecting the innovation capacity of the sectors.
    Date: 2023–07
  2. By: Ho, Florence Ut Meng
    Abstract: This paper develops a North-South quality-ladder model with northern innovative R&D, southern adaptive R&D and imitative R&D to analyze the effects of tariffs on innovation, technology transfer, relative wage and welfare. We find that increasing southern tariff decreases the relative wage between the North and the South permanently, increases the technology transfer rate permanently and decreases the northern innovation rate temporarily. In contrast, increasing northern tariff increases the relative wage permanently, decreases the technology transfer rate permanently and either increases or decreases the northern innovation rate, depending on the size of the North-South labor ratio. Moreover, we calibrate this model to the US-China data to perform a quantitative analysis. We find that imposing tariff in the home country yields welfare gain in itself and yields welfare loss in the foreign country. When both countries impose tariffs simultaneously, they can benefit from the welfare gains. The numerical results are consistent with the analytical policy implications.
    Keywords: Tariffs; Technology Transfer; Innovation; Foreign Direct Investment; Product Cycles.
    JEL: F13 F4
    Date: 2023–06–21
  3. By: Richard G. Lipsey (Professor Emeritus at Simon Fraser University)
    Abstract: This paper distinguishes four types of public policies that seek to encourage growth-creating technological advance: technology, R&D, industrial, and science policies. The first three are typically treated under the single heading ‘industrial policy’, which is a source of confusion since each is administered by different agents and in different manners. Evidence of the many failures of industrial policy, as defined here, is often incorrectly assumed by its critics to apply to technology and R&D policies. Evidence for the many successes of technology policy’s symbiotic relation between the public and the private sectors is outlined, although typically ignored by growth theorists. The massive influence of science policy on economic growth, also typically ignored by growth theorists, is a largely unintended byproduct of scientific advance.
    Date: 2023–07
  4. By: Stefan Apostol; Eduardo Hernández-Rodríguez
    Abstract: Digitalisation has become a clear policy objective. Regions want to digitalise their economies to benefit from the digital world. This paper provides empirical evidence on how the adoption of new digital web technologies is shaped by previous regional digital capabilities. The analysis is based upon an economic complexity and relatedness framework using novel data on digital web technologies’ adoption for 278 European NUTS-2 regions between years 2000-2022. Results show that regions tend to adopt new digital web technologies when they already master related digital capabilities. This paper also shows how digital complexity is associated with labour productivity gains at the regional level. Conclusions shed light on how regions are adopting digital web technologies and serve as a tool for policymakers.
    Keywords: Digitalisation; digital web technologies; relatedness; economic complexity; productivity; European regions
    JEL: L86 O14 O33 R11
    Date: 2023–08

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