nep-knm New Economics Papers
on Knowledge Management and Knowledge Economy
Issue of 2006‒09‒30
nine papers chosen by
Emanuele Canegrati
London School of Economics and Political Science

  1. The Regional Dimension of Knowledge Transfers - A Behavioral Approach By Tom Brökel; Martin Binder
  2. Organizational Structure as the Channeling of Boundedly Rational Pre-play Communication By Ellingsen, Tore; Östling, Robert
  3. Climbing Atop the Shoulders of Giants: The Impact of Institutions on Cumulative Research By Jeffrey L. Furman; Scott Stern
  4. Open Source Software Acquisition By Holck,, Jesper; Pedersen, Mogens Kühn; Larsen, Michael Holm
  5. Framing Effects as Violations of Extensionality By Raphaël Giraud; Sacha Bourgeois-Gironde
  6. Recursive Smooth Ambiguity Preferences By Peter Klibanoff; Massimo Marinacci; Sujoy Mukerji
  7. Has the European ICT sector a chance to be competitive ? By Christian Genthon; Godefroy Dang Nguyen
  8. France's search for institutional schemes to promote innovation : the case of genomics By Anne Branciard
  9. Reliability and Responsibility: A Theory of Endogenous Commitment By Matteo Triossi

  1. By: Tom Brökel; Martin Binder
    Abstract: Innovations are inherently connected to knowledge transfers. The need of face-to-face contacts to transfer tacit knowledge is commonly argued to cause a regional dimension of innovative activities. The paper presents an alternative explanation based on a model of boundedly rational actors who search for knowledge. It is shown that a regional dimension exists in these processes that results from a regional bias in an actor’s search activities. Social embeddedness, a shared regional identity and limited spatial mobility foster this bias. We argue that insights from research on these topics can help to define the geographic size of a region.
    Keywords: Regional Economics, Innovation, Knowledge Transfers, Tacit Knowledge, Bounded Rationality Length 31 pages
    JEL: B52 D83 O31 R12
    Date: 2006–09
  2. By: Ellingsen, Tore (Dept. of Economics, Stockholm School of Economics); Östling, Robert (Dept. of Economics, Stockholm School of Economics)
    Abstract: We model organizational decision making as costless pre-play communication. Decision making is called authoritarian if only one player is allowed to speak and consensual if all players are allowed to speak. Players are assumed to have limited cognitive capacity and we characterize their behavior under each decision making regime for two different cognitive hierarchy models. Our results suggest that authoritarian decision making is optimal when players have conflicting preferences over the set of Nash equilibrium outcomes, whereas consensual decision making is optimal when players have congruent preferences over this set. The intuition is that authoritarian decision making avoids conflict, but sometimes creates insufficient mutual trust to implement socially optimal outcomes.
    Keywords: Organizational decision making; coordination games; communication; cognitive hierarchy models
    JEL: C72 L20 M21 M54
    Date: 2006–09–25
  3. By: Jeffrey L. Furman; Scott Stern
    Abstract: While the cumulative nature of knowledge is recognized as central to economic growth, the microeconomic foundations of cumulativeness are less understood. This paper investigates the impact of a research-enhancing institution on cumulativeness, highlighting two effects. First, a selection effect may result in a high correlation between “high-quality†institutions and knowledge of high intrinsic quality. Second, an institution may have a marginal impact – an incremental influence on cumulativeness, conditional on the type and quality of knowledge considered. This paper distinguishes these effects in the context of a specific institution, biological resource centers (BRCs). BRCs are “living libraries†that authenticate, preserve, and offer independent access to biological materials, such as cells, cultures, and specimens. BRCs may enhance the cumulativeness of knowledge by reducing the marginal cost to researchers of drawing on prior research efforts. We exploit three key aspects of the environment in which BRCs operate to evaluate how they affect the cumulativeness of knowledge: (a) the impact of scientific knowledge is reflected in future scientific citations, (b) deposit into BRCs often occurs with a substantial lag after initial research is completed and published, and (c) “lagged†deposits often result from shocks unrelated to the characteristics of the materials themselves. Employing a difference-in-differences estimator linking specific materials deposits to journal articles, we find evidence for both selection effects and the marginal impact of BRCs on the cumulativeness of knowledge associated with deposited materials. Moreover, the marginal impact increases with time and varies with the economic and institutional conditions in which deposit occurs.
    JEL: H4 L3 O3 O33
    Date: 2006–09
  4. By: Holck,, Jesper (Department of Informatics, Copenhagen Business School); Pedersen, Mogens Kühn (Department of Informatics, Copenhagen Business School); Larsen, Michael Holm (Department of Informatics, Copenhagen Business School)
    Abstract: Lately we have seen a growing interest from both public and private organisations to adopt Open Source Software (OSS), not only for a few, specific applications but also on a more general level throughout the organisation. As a consequence, the organisations’ decisions on adoption of OSS are becoming increasingly more important and complex. We present three perspectives organisations can employ in their decisions: seeing OSS acquisition as a business case, as COTS acquisition, and as architectural change within a governance framework. We present case studies of decisions on OSS adoption, and categorise the decision criteria we have found. Our results indicate that for large-scale adoption of OSS, focus will be on architectural considerations: enterprise-wide architectures will at first be a barrier, but in the long term OSS’s support of open standards can be a major enabler for OSS adoption. In contrast, in smaller organisations and in small-scale adoption of OSS, the cheap price of OSS is a major enabler, as it provides a good opportunity for experiments and short-term economic benefits. For small organisations these experiments can lead to development of a common IT-architecture, and in larger organisations OSS can be adopted in niche-areas, without significantly violating an existing IT-architecture.
    Keywords: open source; COTS; IT architecture; governance
    JEL: H00
    Date: 2005–09–19
  5. By: Raphaël Giraud (CRESE - Centre de recherche sur les stratégies économiques - [Université de Franche-Comté], CES - Centre d'Economie de la Sorbonne - [CNRS : UMR8174] - [Université Panthéon-Sorbonne - Paris I]); Sacha Bourgeois-Gironde (IJN - Institut Jean-Nicod - [CNRS : UMR8129] - [Ecole des Hautes Etudes en Sciences Sociales][Ecole Normale Supérieure de Paris])
    Abstract: Framing effects occur when different descriptions of the<br />same decision problem give rise to divergent decisions. They can be seen as a violation of the decision-theoretic version of the principle of extensionality (PE). The PE in logic means that two logically equivalent sentences can be substituted salva veritate. We explore what this notion of extensionality becomes in decision contexts. Violations of extensionality may have rational grounds. Following some ideas proposed by the psychologist C. McKenzie we contend that framing effects are justified when the selection of one particular frame conveys choice relevant information. We first discuss this idea from a philosophical point of view, and proceed next to formalize it in the context of the Bolker Jeffrey decision theory.
    Keywords: Framing effects; Extensionality; Invariance principle; Conversational implicatures; rationality
    Date: 2006–09–23
  6. By: Peter Klibanoff; Massimo Marinacci; Sujoy Mukerji
    Abstract: This paper axiomatizes an intertemporal version of the Smooth Ambiguity decision model developed in Klibanoff, Marinacci, and Mukerji (2005). A key feature of the model is that it achieves a separation between ambiguity, identified as a characteristic of the decision maker’s subjective beliefs, and ambiguity attitude, a characteristic of the decision maker’s tastes. In applications one may thus specify/vary these two characteristics independent of each other, thereby facilitating richer comparative statics and modeling flexibility than possible under other models which accomodate ambiguity sensitive preferences. Another key feature is that the preferences are dynamically consistent and have a recursive representation. Therefore techniques of dynamic programming can be applied when using this model.
    Keywords: Ambiguity, Uncertainty, Knightian Uncertainty, Ambiguity Aversion, Uncertainty Aversion, Ellsberg Paradox, Dynamic Decision Making, Dynamic Programming under Ambiguity, Smooth Ambiguity.
    JEL: D80 D81
    Date: 2006
  7. By: Christian Genthon (LEPII - Laboratoire d'Economie de la Production et de l'Intégration Internationale - [CNRS : FRE2664] - [Université Pierre Mendès-France - Grenoble II]); Godefroy Dang Nguyen
    Abstract: The ICT sector is featured by technical progress, convergence and systems integration. This leads to risks of monopolization regimes at the core with higher competition regimes at the periphery. Moreover, some specific component of the system may be essential for its evolution. In particular, networking to some extent creates the system, while software (notably operating systems) is the “glue” which holds it together. In this context, the European ICT industry is potentially smashed between the cost advantages of Asian countries such as China, and the inventiveness and dynamism of the US industry. The way out of this difficult situation is to create in Europe the conditions of restoring knowledge accumulation. By concentrating on an ambitious project of open source software production in embarked and domestic systems, Europe could reach several objectives: to make freely accessible an essential facility of networks, to stimulate competition, to help reaching the Lisbon objectives and to restore the European competitiveness in ICT.
    Keywords: information and communications technologies ; industrial policy ; competition regimes ; knowledge based society ; open source
    Date: 2006–09–19
  8. By: Anne Branciard (LEST - Laboratoire d'économie et de sociologie du travail - [CNRS : UMR6123] - [Université de Provence - Aix-Marseille I][Université de la Méditerranée - Aix-Marseille II])
    Abstract: The subject of this paper is the relationship between the policy-making and the innovation performance in genomics and biomedical related biotechnologies in the national research and innovation system in France in 1990'. The aim is to highlight the relative effectiveness of the different public policies and their instruments compared to the action of the non for profit sector. Government policy has recently supported a development of the biotechnology sector by encouraging start-ups and creating favourable framework conditions such as incubators, a specialised stock exchange, financial institutions or technopoles. <br />By studying the co-ordination mechanisms between the different organisations (non for profit organisations, public authorities, public sector research, biotech SMEs and large firms, especially in the biomedical sector), this paper shows that the path dependant institutions and the contradiction between the different policy tools to promote science base knowledge commercialisation can explain the poor development of biotech sector in France in the last few years, in spite of a high investment in the basic scientific researcb in life sciences.
    Keywords: innovation system; S§T policy; biotechnology; genomics; Triple Helix model; France; policy-making; diffusion-oriented policy; science base knowledge
    Date: 2006–09–24
  9. By: Matteo Triossi
    Abstract: A common assumption in Political Science literature is policy commitment: candidates maintain their electoral promises. We drop such assumption and we show that costless electoral campaign can be an effective way of transmitting information to voters. The result is robust to relevant equilibrium refinements. An unavoidable proportion of ambiguous politicians emerges.
    Keywords: Information Transmission, Electoral Campaign, Endogenous Commitment.
    JEL: D72 P16 C73
    Date: 2006

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