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on Microeconomics |
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Issue of 2007‒06‒23
five papers chosen by Joao Carlos Correia Leitao University of the Beira Interior |
| By: | Nicoletta Corrocher (CESPRI - Bocconi University, Milan, Italy and NFH - University of Tromso, Tromso, Norway.); Lorenzo Zirulia (CESPRI - Bocconi University, Milan and University of Bologna, Bologna, Italy.) |
| Abstract: | This paper aims at analyzing the characteristics and the determinants of innovation in the mobile communication service industry, by emphasising in particular the role of demand. In a Shumpeterian spirit, we argue that competition in this sector crucially depends upon innovation, and that, given the specific characteristics of the industry, firms' innovative strategies are strongly affected by demand. Our main point is that in a context of uncertainty, demand affects firms' innovative strategies in two ways: first, by providing information on users' behaviour and by increasing the capability of market segmentation; second, by providing invcentives to innovate. This argument is supported by an empirical analysis carried out on the basis of an original dataset including all the tariff plans offered in the history of the Italian market up to 2005. We find that both firms' installed base of customers and market saturation play a role in shaping firms' innovative activities, in terms of number and type of innovations. |
| Keywords: | Service Innovation, Demand Characteristics, Mobile Communications. |
| JEL: | O31 L96 D43 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cri:cespri:wp199&r=mic |
| By: | Michael Noel; Mark Schankerman |
| Abstract: | Strategic patenting is widely believed to raise the costs of innovating,especially in industries characterised by cumulative innovation. This paperstudies the effects of strategic patenting on R&D, patenting and marketvalue in the computer software industry. We focus on two key aspects:patent portfolio size which affects bargaining power in patent disputes, andthe fragmentation of patent rights (.patent thickets.) which increases thetransaction costs of enforcement. We develop a model that incorporates botheffects, together with R&D spillovers. Using panel data for the period 1980-99, we find evidence that both strategic patenting and R&D spilloversstrongly affect innovation and market value of software firms. |
| Keywords: | patents, anti-commons, patent thickets, R&D spillovers, marketvalue |
| JEL: | L43 L86 O31 O32 O33 O34 O38 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stieip:43&r=mic |
| By: | Marin, Dalia; Verdier, Thierry |
| Abstract: | This paper develops a theory which investigates how firms' choice of corporate organization is affecting firm performance and the nature of competition in international markets. We develop a model in which firms' organisational choices determine heterogeneity across firms in size and productivity in the same industry. We then incorporate these organisational choices in a Krugman cum Melitz and Ottaviano model of international trade. We show that the toughness of competition in a market depends on who - headquarters or middle managers - have power in firms. Furthermore, we propose two new margins of trade adjustments: the monitoring margin and the organizational margin. International trade may or may not lead to an increase in aggregate productivity of an industry depending on which of these margins dominate. Trade may trigger firms to opt for organizations which encourage the creation of new ideas and which are less well adapt to price and cost competition. |
| Keywords: | firm heterogeneity; international trade with endogenous firm organizations; productivity; theory of the firm; trade adjustment |
| JEL: | D23 F12 F14 L22 |
| Date: | 2007–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6342&r=mic |
| By: | Brito, Paulo; Dixon, Huw (Cardiff Business School) |
| Abstract: | In this paper we consider the entry and exit of firms in a dynamic general equilibrium model with capital and a fixed labour supply. At the firm level, there is a fixed cost combined with increasing marginal cost, which gives a standard U-shaped cost curve with optimal firm size. Entry is determined by a free entry condition such that the costs of entry are equal to the present value of incumbent firms. As short run profits are a decreasing function of the number of firms, we add a new stability mechanism in addition to the diminishing returns to capital. Then equilibrium is saddle-point stable and the stable manifold is two-dimensional. Transitional dynamics can, under certain circumstances, be non-monotonic. We study the effects of productivity and fixed cost shocks on the aggregate activity, the number and the size of firms. |
| Keywords: | Entry; dynamics; Ramsey |
| JEL: | D92 C62 E32 O41 |
| Date: | 2007–06 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2007/16&r=mic |
| By: | BISMUT, Sophie |
| Abstract: | In recent years, the European telecommunications market has witnessed major developments, with rapid expansion in access to telecommunications networks and a surge in the number of available services and applications. While many factors have contributed to the transformation of the telecommunications industry, competition has played a key role in driving telecom players to invest in new technologies, to innovate and to offer new services. Increased competitive pressure is being felt across all market segments, even though significant differences remain across services and countries. Broadband roll-out has allowed operators to offer multiple-play services, thereby transforming traditional segment boundaries and competitive market structures. |
| Keywords: | competition; access; convergence; multiple-play; fixed telephony; mobile services; broadband; VoIP; MVNO. |
| JEL: | L51 L40 L50 L41 K23 L96 L33 L94 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:3567&r=mic |