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on Innovation |
| By: | Carolina Castaldi |
| Abstract: | Mapping innovation in space is part and parcel of research on the geography of innovation. The maps we produce reflect both how we conceptualize innovation and the data and indicators we choose to measure it. They can shape research directions and policy strategies. As research on the geography of innovation expands, this paper asks the question: How do innovation maps reflect these evolving perspectives? |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:egu:wpaper:2505 |
| By: | Salomé Baslandze; Leo Liu; Elvira Sojli; Wing Wah Tham |
| Abstract: | This paper studies the interaction between process and product innovations and their distinct role in firm growth dynamics. We differentiate empirically and theoretically two types of process innovations: foundational processes that advance production technology and cost-reducing processes that enhance existing production efficiency. We develop an innovation model of product varieties with quality heterogeneity to illustrate how these innovations affect firm growth differently and highlight how process innovation induces product innovation. By analyzing millions of patent texts from 1900 to 2020, we classify innovations into product, cost-reducing process, and foundational process innovations. We find that foundational processes lead to sustained firm growth, especially through their effect on subsequent product creation. R&D-intensive firms focused on “deep-tech” innovations have an advantage in creating foundational processes, resulting in superior product quality. Using patents linked to FDA-approved drugs, we show that firms with a comparative advantage in creating foundational processes, due to greater knowledge and technological stock, tend to produce higher-value products. |
| Keywords: | foundational process innovation; process innovation; product innovation; process-driven products; firm growth; technological possibility frontier |
| JEL: | O3 O4 |
| Date: | 2025–02–19 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedawp:99586 |
| By: | Hötte, Kerstin; Jee, Su Jung |
| Abstract: | Escaping the middle-income trap requires a country to develop indigenous technological capabilities for high value-added innovation. This study examines the role of second-tier patent systems, known as utility models (UMs), in promoting such capability acquisition in less developed countries. UMs are designed to incentivize incremental and adaptive innovation through lower novelty standards than patents, but their long-term impact on the capability acquisition process remains underexplored. Using South Korea as a case study and drawing on the characteristics of technological regimes in catching-up economies, we present three key findings: First, the country's post-catch-up frontier technologies (US patents) are more impactful (highly cited) when they build on Korean domestic UMs. This suggests that UM-based imitative and adaptive learning laid the foundation for the country's globally competitive capabilities. Second, the impact of UM-based learning diminishes as the country's economy develops. Third, frontier technologies rooted in UMs contribute more to the country's own specialization than to follow-on innovations by foreign actors, compared to technologies without UM linkages. We discuss how technological regimes and industrial policies in catching-up economies interact with the UM system to bridge the catching-up (imitation- and adaptation-based) and postcatching-up (specialization- and creativity-based) phases. |
| Keywords: | utility model, intellectual property rights, middle-income trap, technological capabilities, specialization |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2024-05 |
| By: | Benjamin Cornejo Costas; Nicola Cortinovis; Andrea Morrison; |
| Abstract: | This paper investigates the relationship between migrant inventors, informal institutions and the development of green technologies in European regions. We argue that migrant inventors act as an unlocking mechanism that transfers external knowledge to host regions, and that informal institutions (i.e. social capital, migrant acceptance) mediate this effect. The work is based on an original dataset of migrant inventors covering 271 NUTS2 regions in the 27 EU countries, the UK, Switzerland, and Norway. The analysis shows that migrant inventors help their host regions to diversify into green technologies. The regions with the highest levels of both measures of social capital show a higher propensity of migrant inventors to act knowledge brokers. Conversely, regions with lower levels of migrant acceptance and social capital do not seem to contribute to this effect. |
| Keywords: | lock-in, international migration, green innovation, social capital, acceptance, regional diversification, EU regions |
| JEL: | F22 J61 O30 R12 Q55 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:egu:wpaper:2503 |
| By: | Hötte, Kerstin; Tarannum, Taheya; Verendel, Vilhelm; Bennett, Lauren |
| Abstract: | Governing artificial intelligence (AI) is high on the political agenda, but it is still not clear how to define and measure it. We compare four approaches to identifying AI patented inventions that reflect different ways of understanding AI with divergent definitions. Using US patents from 1990-2019, we assess the extent to which each approach qualifies AI as a general purpose technology (GPT) and study patterns of concentration, which both are criteria relevant for regulation. The four approaches overlap on only 1.37% of patents and vary in scale, accounting for shares that range from 3-17% of all US patents in 2019. The smallest set of AI patents in our sample, identified by the latest AI keywords, is most GPT-like with high levels of growth and generality. All four approaches show AI inventions to be concentrated in few firms, confirming worries about competition. Our results suggest that regulation may not be straightforward, as the identification of AI inventions ultimately depends on how AI is defined. |
| Keywords: | Artificial Intelligence, Governance, General Purpose Technology, Concentration, Patent, Classification |
| JEL: | O31 O33 O34 |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2024-02 |
| By: | Yu Cao; Francesca de Nicola; Aaditya Mattoo; Jonathan David Timmis |
| Abstract: | Recent U.S.-China tensions have raised the specter of technological decoupling. This paper examines the impact of U.S. export restrictions and technology licensing on Chinese firms’ innovation. It finds that U.S. sanctions reduce the quantity and quality of patent outputs of targeted Chinese firms, primarily due to decreased collaboration with U.S. inventors. However, firms with higher initial patent stock or in sectors with a smaller technological distance to the U.S. are less affected. Sanctions in specific technology fields lead to a decline in the patent output of both Chinese firms with U.S. collaborators and U.S. firms with Chinese collaborators. |
| Date: | 2024–10–15 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10950 |
| By: | Antonin Bergeaud (CEPR - Center for Economic Policy Research, Centre de recherche de la Banque de France - Banque de France); Arthur Guillouzouic (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, IPP - Institut des politiques publiques, Sciences Po - Sciences Po) |
| Abstract: | Following Bergeaud et al. (2022), we construct a new measure of proximity between industrial sectors and public research laboratories. Using this measure, we explore the underlying network of knowledge linkages between scientific fields and industrial sectors in France. We show empirically that there exists a significant negative correlation between the geographical distance between firms and laboratories and their scientific proximity, suggesting strongly localized spillovers. Moreover, we uncover some important differences by field, stronger than when using standard patent-based measures of proximity. |
| Keywords: | Knowledge Spillovers, Technological Distance, Public Laboratories |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ipppap:hal-04938250 |
| By: | Hipólito, Inês |
| Abstract: | This paper applies complex systems theory to examine generative artificial intelligence (AI) as a contemporary wicked problem. Generative AI technologies, which autonomously create content like images and text, intersect with societal domains such as ethics, economics, and governance, exhibiting complex interdependencies and emergent behaviors. Using methodologies like network analysis and agent-based modeling, the paper maps these interactions and explores potential interventions. A mathematical model is developed to simulate the dynamics between key components of the AI-society system, including AI development, economic concentration, labor markets, regulatory frameworks, public trust, ethical implementation, global competition, and distributed AI ecosystems. The model demonstrates non-linear dynamics, feedback loops, and sensitivity to initial conditions characteristic of complex systems. By simulating various interventions, the study provides insights into strategies for steering AI development towards more positive societal outcomes. These include strengthening regulatory frameworks, enhancing ethical implementation, and promoting distributed AI ecosystems. The paper advocates for using this complex systems framework to inform inclusive policy and regulatory strategies that balance innovation with societal well-being. It concludes that embracing complexity enables stakeholders to better navigate the evolving challenges of generative AI, fostering more sustainable and equitable technological advancements. |
| Date: | 2024–08–29 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:aq4tw_v1 |
| By: | Oyun Erdene Adilbish; Mr. Diego A. Cerdeiro; Mr. Romain A Duval; Mr. Gee Hee Hong; Luca Mazzone; Lorenzo Rotunno; Hasan H Toprak; Maryam Vaziri |
| Abstract: | Europe faces a well-known productivity malaise, with a large and widening aggregate productivity gap relative to the U.S. In this paper, we provide a novel diagnosis of the firm-level roots of Europe’s productivity growth slowdown through an analysis of data covering the universe of firms in Europe and the U.S over their life cycles. Compared to their U.S. counterparts, we identify critical performance gaps among both Europe’s frontier firms and young high-growth firms. Our firm-level analyses reveal that smaller markets and limited market-based financing are key bottlenecks for frontier European firms, while skill shortages and insufficient risk capital, such as venture capital, hinder the formation and subsequent growth of young firms in Europe. These findings suggest that removing remaining intra-Europe barriers to accelerate factor and product markets integration, alongside national reforms to facilitate swifter resource reallocation and enhance human capital, could help revive Europe’s productivity growth. |
| Keywords: | Firm-level productivity; business dynamism. |
| Date: | 2025–02–14 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/040 |
| By: | Daniel P. Gross; Bhaven N. Sampat |
| Abstract: | During World War II, the U.S. Committee on Medical Research (CMR) undertook an integrated, cross-sectoral effort to develop medical science and technology for war, representing the U.S. government's first substantial investment in medical research. Using data on all CMR research contracts, we show that although it had mixed results during the war, it left a large imprint on the postwar U.S. biomedical innovation system. Research areas it supported experienced rapid growth in postwar science, especially in new subjects. It also stimulated the U.S. pharmaceutical industry's adoption of modern science-based drug discovery, fueled new postwar drug development, influenced medical practice, and shaped extramural research funding at the National Institutes of Health. Contemporary accounts of individual CMR programs point to specific ways these investments enabled old and new subjects to grow. The evidence documents the long-run effects coordinated, application-oriented biomedical research can have on science and technology and challenges the influential 'linear model' paradigm in research policy. |
| JEL: | H51 H56 N42 N72 O31 O32 O33 O38 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33457 |
| By: | Paulo Bastos; Katherine Stapleton; Daria Taglioni; Wei, Hannah Yi |
| Abstract: | This study examines the role of multinational firms and global value chain linkages in the cross-country diffusion of emerging technologies. The analysis combines detailed information on the near-universe of online job postings in 17 countries with data on multinational networks and firm-to-firm linkages from 2014 to 2022. Online job postings are utilized to investigate how jobs related to emerging technologies spread through firm networks. The findings show that emerging technology jobs are highly concentrated within multinational firms and their supply chains. Approximately one third of all emerging technology job postings during this period come from Fortune 500 firms, their affiliates, buyers, suppliers, or innovation partners. Although the locations where these technologies originate exhibit a higher prevalence of technology job openings, this advantage diminishes over time as diffusion accelerates in wealthier and geographically closer countries and regions. The study highlights the significant role of firm-to-firm linkages in technology diffusion, with some linkages proving more influential than others. Firms that were previously buyers or innovation partners of establishments in technology-originating locations experienced faster growth in jobs related to these technologies. Moreover, relationships outside corporate boundaries play a particularly critical role, and these connections are influential beyond the factor of geographical distance. |
| Date: | 2024–09–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10905 |
| By: | Can Sever |
| Abstract: | Economic growth in the advanced economies (AEs) has been slowing down since the early 2000s, while government debt ratios have been rising. The recent surge in debt at the onset of the Covid-19 pandemic has further intensified concerns about these phenomena. This paper aims to offer insight into the high-debt low-growth environment in AEs by exploring a causal link from government debt to future growth, specifically through the impact of debt on R&D activities. Using data from manufacturing industries since the 1980s, it shows that (i) government debt leads to a decline in growth, particularly in R&D-intensive industries; (ii) the differential effect of government debt on these industries is persistent; and (iii) more developed or open financial systems tend to mitigate this negative impact. These findings contribute to our understanding of the relationship between government debt and growth in AEs, given the role of technological progress and innovation in economic growth. |
| Keywords: | Government debt; fiscal policy; economic growth; R&D; innovation; financial development |
| Date: | 2025–02–07 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/036 |
| By: | Altunay, Paul-Christoph; Vetter, Oliver A. |
| Abstract: | The rapid advancement of artificial intelligence (AI) has ushered in a surge of AI startups. AI startups have been hypothesized to be organized in and benefit from ecosystems, with concrete research to substantiate this claim remaining scarce. We aim to bridge this gap by providing a first step towards a scientific understanding of AI startup ecosystems, focusing on investor-related ecosystem effects. We employ a network theory approach to examine the relationship between investor-related ecosystems and AI startup success. We provide an overview of how investor-related ecosystems influence the success of AI startups and how investor types affect their success differently. Findings suggest that AI startups disproportionately benefit from investor-related ecosystem effects and that they differ by investor type, suggesting a new pecking order for choosing investors. In light of these results, practitioners and scholars are prompted to reassess established norms of entrepreneurial finance and startup success factors concerning AI startups. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:152916 |
| By: | Daron Acemoglu |
| Abstract: | This paper reviews the main motivations and arguments of my work on comparative development, colonialism and institutional change, which was often carried out jointly with James Robinson and Simon Johnson. I then provide a simple framework to organize these ideas and connect them with my research on innovation and technology. The framework is centered around a utility-technology possibilities frontier, which delineates the possible distributions of resources in a society both for given technology and working via different technological choices. It highlights how various types of institutions, market structures, norms and ideologies influence moves along the frontier and shifts of the frontier, and it provides a simple formalization of the social forces that lead to institutional persistence and those that can trigger institutional change. The framework also enables us to conceptualize how, during periods of disruption, existing—and sometimes quite small—differences can have amplified effects on prosperity and institutional trajectories. In this way, it suggests some parallels between different disruptive periods, including the onset of European colonialism, the spread (or lack thereof) of industrial technologies in the 19th century, and decisions related to the use, adoption and development of AI today. |
| JEL: | N30 O33 P50 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33442 |