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on Technology and Industrial Dynamics |
| By: | Grimpe, Christoph; Hussinger, Katrin |
| Abstract: | This paper investigates the motive of pre-empting technology competition through mergers and acquisitions (M&A). Exploiting the patent application procedure at the European Patent Office we introduce a new measure for the possibility to create entry barriers in technology markets. Our results show significant evidence that firms engage in horizontal M&A to pre-empt competition in technology markets. |
| Keywords: | pre-empting technology competition, mergers and acquisitions |
| JEL: | G34 L20 O34 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5590&r=tid |
| By: | Enrico Santarelli (University of Bologna, Department of Economics; ENCORE, Amsterdam; Max Planck Institute of Economics Jena, Entrepreneurship, Growth and Public Policy); Francesca Lotti (Bank of Italy, Economic Research Department) |
| Abstract: | The aim of this paper is to test whether patent-based indicators are still reliable measures of innovativeness in light of organizational changes in the field of Intellectual Property Rights (IPR) protection and the regulatory reforms already under way respectively at the U.S. Patent and Trademark Office (USPTO) and the European Patent Office (EPO). For most high-tech industries, patents represent an outcome of the production process and their number can be taken as a proxy for a firm's ability to improve its productivity growth and profitability. The case study reported here concerns the biotechnology industry in Italy, whose firms, by definition, have Intellectual Property (IP) activities in their portfolios. For this purpose, we use a unique data set which collects balance sheet items and patent information from EPO and USPTO. After linking firms' financial and production data with the patent information, we estimate a modified knowledge production function in which the dependent variable is alternatively (labor) productivity growth and profitability. Our findings show that only patents with the EPO, along with larger firm size, have a statistically significant relationship with productivity growth and profitability. This suggests that firms pursue different strategies when patenting with the USPTO and the EPO, and that this difference reflects statutory changes made to the former during the relevant period. |
| Keywords: | IP Protection, Productivity, Profitability, Italy |
| JEL: | L25 L65 O34 |
| Date: | 2007–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2007-020&r=tid |
| By: | Gonzalez, Jorge; Sismeiro, Catarina; Dutta, Shantanu; Stern, Philip |
| Abstract: | Patent expiration represents a turning point for the brand losing patent protection as bioequivalent generic versions of the drug quickly enter the market at reduced prices. In this paper, we study how physician characteristics and their prescribing decisions impact the competition among molecules of a therapeutic class, once generic versions of one of these molecules enter the market. Specifically, we study the evolution of the Selective Serotonine Reuptake Inhibitors (SSRIs) after the introduction of generic versions of fluoxetine (brand name Prozac) in the United Kingdom (UK). Our results suggest that, to fully understand the market evolution after generic entry, public health officials need to consider the marketing activities of pharmaceutical companies and determine how (1) individual physicians prescribe all competing drugs, and (2) respond to drug prices and marketing actions. For example, we find that a group of physicians sensitive to detailing switch from fluoxetine to non-bioequivalent branded alternatives after patent expiration, as Prozac significantly reduces its marketing support. Consequently, the market share of fluoxetine decreases despite being available at significant price discount under generic form, and despite the increase of prescriptions by price-sensitive physicians. Hence, governments interested in assessing generics diffusion should consider the prescribing across all competitors, whether or not bioequivalent, and determine the size of physician segments sensitive to pharmaceutical marketing activity and prices. |
| JEL: | I1 H51 C50 M31 C11 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:3717&r=tid |
| By: | Joachim Wagner (Institute of Economics, Leuphana University of Lüneburg) |
| Abstract: | This paper contributes to the flourishing literature on exports and productivity by using a unique newly available panel of exporting establishments from the manufacturing sector of Germany from 1995 to 2004 to test three hypotheses derived from a theoretical model by Hopenhayn (Econometrica 1992): (H1) Firms that stop exporting in year t were in t-1 less productive than firms that continue to export in t. (H2) Firms that start to export in year t are less productive than firms that export both in year t-1 and in year t. (H3) Firms from a cohort of export starters that still export in the last year of the panel were more productive in the start year than firms from the same cohort that stopped to export in between. While results for West Germany support all three hypotheses, this is only the case for (H1) and (H2) in East Germany. |
| Keywords: | Export entry, export exit, productivity |
| JEL: | F14 L60 |
| Date: | 2007–06 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:54&r=tid |
| By: | Alex Coad (Centre d'Economie de la Sorbonne) |
| Abstract: | We survey the phenomenon of the growth of firms drawing on literature from economics, management and sociology. We begin with a review of empirical "stylised facts" before discussing theoretical contributions. Firm growth is characterized by a predominant stochastic element, making it difficult to predict. Indeed, previous empirical research into the determinants of firm growth has had a limited success. We also observe that theoretical propositions concerning the growth of firms are often amiss. We conclude that progress in this area requires solid empirical work, perhaps making use of novel statistical techniques. |
| Keywords: | Firm growth, size distribution, growth rates distribution, Gibrat's law, theory of the firm, diversification, "stages of growth" models. |
| JEL: | L25 L11 |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:r07024&r=tid |
| By: | Lundin, Nannan (Research Institute of Industrial Economics (IFN)); Sjöholm, Fredrik (Research Institute of Industrial Economics (IFN)); He, Ping (National Bureau of Statistics of China); Qian , Jinchang (National Bureau of Statistics of China) |
| Abstract: | FDI can be an important channel for developing countries’ ability to get access to new technology. The impact of FDI on domestically-owned firms’ technology development is less examined but it is frequently argued that technology externalities or demonstration effects could have a positive impact. Another and so far little examined effect of FDI on technology development in domestically-owned firms is through the impact on competition. We examine the effect of FDI on competition in the Chinese manufacturing sector and the effect of competition on firms’ R&D. Our analysis is conducted on a large dataset including all Chinese large and medium sized firms over the period 1998-2004. Our results show that FDI increases competition but there are no strong indications of competition affecting investments in R&D. |
| Keywords: | China; FDI; Competition; R&D |
| JEL: | F23 L11 O31 |
| Date: | 2007–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0708&r=tid |