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on Innovation |
| By: | Robinson, Douglas K. R. (Université Gustave Eiffel); Borrás, Susana (Copenhagen Business School); Boon, Wouter P.C. (Utrecht University) |
| Abstract: | This editorial focuses on the diverse studies and frameworks related to the diffusion of innovations, building beyond Everett Rogers’ seminal work from 1962. Despite a renewed interest in diffusion research, fragmentation exists as different academic communities work independently with limited cross-referencing. Seeing great advantage in building bridges and exchanging insights across these conceptual and empirical expansions of Rogers, this editorial explores the heterogeneous nature of diffusion, encompassing various innovation types, systems, geographies and pathways. Using “generalisation” as a broad umbrella term that captures the essence of these expansions on diffusion theory, whilst remaining open to different conceptualisations, eight building blocks were identified from the literature to characterise generalisation, offering new research avenues. The special issue encompasses nine articles in which a broader understanding of diffusion is explored. Key lessons include recognising diffusion as a set of heterogeneous activities involving different innovations, actors, and institutional logics, considering temporal aspects, anticipating repercussions on user groups, and envisioning ethical, legal, and societal impacts for responsible diffusion. These lessons are relevant for policymakers who are increasingly interested in understanding diffusion to address grand challenges. Transformative innovation policy calls for new policy frameworks incorporating diffusion policy measures, which should be build on insights and conceptual frameworks offered by scholars and strategic intelligence provided by decision-makers. |
| Keywords: | Diffusion; innovation policy; generalisation; grand challenges; transformative innovation; mission |
| JEL: | O32 O33 O34 O38 O39 |
| Date: | 2024–11–14 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:lucirc:2024_017 |
| By: | Grillitsch, Markus (CIRCLE, Lund University); Asheim, Björn (University of Stavanger) |
| Abstract: | The chapter discusses the theoretical reorientation in economic geography over the last twenty years from a focus on structures, represented by regional innovation systems, to addressing the role of human agency in regional economic development, and reflects on what the two approaches can contribute to achieving sustainable regional restructuring. We are doing this by focusing on two articles – published in 2002 and 2022 - representing the two approaches. The 2002 article discusses the role of place-specific, local resources and external knowledge in strengthening the competitiveness and innovativeness of firms and regions. This perspective is still relevant in analyses and designs of regional innovation policies. However, a realisation of the shortcomings of a structural approach to explaining the variations of regional development outcomes in different types of regions, has led to a more explicit focus on the importance of change agency in regional change processes, as articulated in the 2022 article. |
| Keywords: | Regional innovation systems; human change agency; regional restructuring; sustainability challenges; local and global; innovation policy |
| JEL: | O30 R10 |
| Date: | 2024–10–30 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:lucirc:2024_013 |
| By: | Hunt, Jennifer (Rutgers University); Cockburn, Iain (Boston University); Bessen, James (Boston University) |
| Abstract: | Using our own data on Artificial Intelligence publications merged with Burning Glass vacancy data for 2007-2019, we investigate whether online vacancies for jobs requiring AI skills grow more slowly in U.S. locations farther from pre-2007 AI innovation hotspots. We find that a commuting zone which is an additional 200km (125 miles) from the closest AI hotspot has 17% lower growth in AI jobs' share of vacancies. This is driven by distance from AI papers rather than AI patents. Distance reduces growth in AI research jobs as well as in jobs adapting AI to new industries, as evidenced by strong effects for computer and mathematical researchers, developers of software applications, and the finance and insurance industry. 20% of the effect is explained by the presence of state borders between some commuting zones and their closest hotspot. This could reflect state borders impeding migration and thus flows of tacit knowledge. Distance does not capture difficulty of in-person or remote collaboration nor knowledge and personnel flows within multi-establishment firms hiring in computer occupations. |
| Keywords: | Artificial Intelligence, technology adoption and diffusion |
| JEL: | O33 R12 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17325 |
| By: | Marius Berger; Antoine Dechezleprêtre; Milenko Fadic |
| Abstract: | Government Venture Capital (GovVC) has emerged as a policy tool to complement private venture capital (Private VC) by funding innovation-driven firms that might not attract traditional VC investment. This study analyses GovVC's role in OECD Member countries using comprehensive data on entrepreneurial firms, investors, and patents, with GovVC entities identified through surveys of ministry experts. The analysis shows that GovVC-funded firms are typically riskier than Private VC funded ones and generally demonstrate lower performance in securing follow-on funding and innovation output. However, when GovVCs partner with Private VC investors, these performance gaps diminish significantly. In co-investment scenarios, firms show comparable innovation and exit performance to those funded solely by Private VC. The findings indicate that GovVC can effectively direct capital to overlooked firms, particularly when working in partnership with private investors. |
| Keywords: | Entrepreneurship, Government Policy, Innovation, Venture Capital |
| JEL: | G24 O38 O31 |
| Date: | 2024–11–12 |
| URL: | https://d.repec.org/n?u=RePEc:oec:stiaaa:2024/10-en |
| By: | Kapetaniou, Chrystalla; Pissarides, Christopher |
| Abstract: | In a model with robots, automatable and nonautomatable production, we study robot-labor substitutions and show how they are influenced by a country's “innovation system.” Substitution depends on demand and production elasticities, the country's innovation capabilities, and openness. Making use of World Economic Forum data, we estimate the relationship for 13 countries and find that countries with poor innovation capabilities substitute robots for workers much more than countries with richer innovation capabilities, which might complement them. Innovation capabilities play a bigger role in the high-tech electronics sector than in other manufacturing and play a limited role in nonmanufacturing. |
| JEL: | J23 L60 O33 O52 |
| Date: | 2024–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:125682 |
| By: | Lars Hornuf; Matthias Mattusch |
| Abstract: | Fintech startups have set out to revolutionize the financial world. However, little is known about how successful and innovative these firms actually are. This paper investigates firm failure, funding success, and innovation capacity using a hand-collected dataset of 892 German fintechs founded between 2000 and 2021. We find that founders with a business degree and entrepreneurial experience have a better chance of obtaining funding, while founder teams with science, technology, engineering, or mathematics backgrounds file more patents. Early third-party endorsements and foreign partnerships substantially increase firm survival. We also establish the following stylized facts: (1) fintechs focusing on business-to-business models and which position themselves as technical providers prove to be more effective; and (2) fintechs competing in segments traditionally reserved for banks are generally less successful and less innovative. These results have important implications for the early-stage success management of fintech firms and the investment decisions of venture capital funds and government startup programs. |
| Keywords: | Fintech industry, firm funding, firm failure, innovation capacity |
| JEL: | G24 M13 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11301 |
| By: | Antonio Minniti (Department of Economics, University of Bologna); Klaus Prettner (Department of Economics, Vienna University of Economics and Business); Francesco Venturini (Department of Economics, University of Urbino) |
| Abstract: | We study how the development of Artificial Intelligence (AI) influences the distribution of income between capital and labor and how this, in turn, exacerbates geographic income inequality. To investigate this issue, we first build a theoretical framework and then analyze data from European regions dating back to 2000. We find that for every doubling of regional AI innovation, there is a 0.7% to 1.6% decline in the labor share, which may have decreased by between 0.20 and 0.46 percentage points from a mean of 52% due solely to AI. This new technology is particularly detrimental to high-skill and medium-skill labor. The impact on income distribution is driven by worsening wage and employment conditions for high-skill labor, and by wage compression for medium- and low-skill labor. The effect of AI is not driven by other factors affecting regional development in Europe, nor by the concentration process in the AI market. |
| Keywords: | Artificial Intelligence, patenting, labor share, European regions |
| JEL: | O31 O32 O34 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp369 |
| By: | Fafaliou, Irene; Konstantios, Dimitrios; Giaka, Maria; Polemis, Michael |
| Abstract: | The relationship between innovation and corporate sustainability constitutes a long-lasting debate among policymakers and researchers. Despite the significant contributions to this field, extant literature does not provide clear answers. This can be attributed to the fact that prior studies do not incorporate the various aspects of innovation to measure their impact on sustainability performance. This study aims to cover this gap in the emerging literature by using a unique micro-level panel dataset consisting of many firms scattered across the US states over the period 2007-2016. Our findings reveal that the basic mechanism for achieving corporate sustainability is through the innovation channel. We also argue that the quantity and value of innovation enhance the sustainability level, whereas these effects are strengthened in times of recession. The empirical results survive robustness checks under alternative innovation measures and different econometric techniques dealing with endogeneity and reverse causality |
| Keywords: | Innovation; Sustainability; Patents; Trademarks; SMEs |
| JEL: | L2 O31 O34 |
| Date: | 2024–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122576 |
| By: | Chavda, Ankur (HEC Paris); Gans, Joshua S. (University of Toronto); Stern, Scott (Massachusetts Institute of Technology) |
| Abstract: | How should theory-based entrepreneurs search for strategies to implement their ideas? The theory-based view of strategy posits that decision-makers hold theories about their environment premised on beliefs that should be actively tested. This causal framework, which underlies the theory-based view, also has implications for entrepreneurial search: the process by which entrepreneurs uncover strategies to implement their ideas. In this paper, we develop a Bayesian model where entrepreneurs update their beliefs as they conduct entrepreneurial search. We find several optimal behaviors for theory-based entrepreneurs such as reverting to a previous strategy after finding a relatively poor strategy and continuing to search after finding a relatively good strategy, which are missing when entrepreneurs lack such a theory-based approach. As these predictions align with examples of successful entrepreneurs, our findings both provide a method to empirically identify skilled entrepreneurs and demonstrate the usefulness of applying the theory-based view to entrepreneurial behavior more generally. |
| Keywords: | entrepreneurial search; theory-based view; stopping rule; Knightian uncertainty |
| JEL: | D81 D83 O32 |
| Date: | 2024–02–13 |
| URL: | https://d.repec.org/n?u=RePEc:ebg:heccah:1505 |
| By: | Andres, Pia |
| Abstract: | Low cost solar energy is key to enabling the transition away from fossil fuels. Despite this, the European Union followed the United States’ example in imposing anti-dumping tariffs on solar panel imports from China in 2013, arguing that Chinese panels were unfairly subsidised and harmed its domestic industry. This paper examines the effects of Chinese import competition on firm-level innovation in solar photovoltaic technology by European firms using a sample of 10, 137 firms in 15 EU countries over the period 1999–2020. I show that firms which were exposed to higher import competition innovated more if they had a relatively small existing stock of innovation, but less if their historical knowledge stock fell within the top 10th percentile of firms in the sample. This suggests that newer firms were more able to respond to increased competition by innovating, while firms with a large historical stock of innovation may have been locked into old technological paradigms. As firms with a smaller knowledge stock tended to innovate more overall, trade with China appears to have been beneficial in encouraging innovation among the most innovative firms. However, I also find evidence that import competition increased the probability of exit among firms in the sample. |
| JEL: | R14 J01 |
| Date: | 2024–10–07 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:125249 |