nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2008‒01‒26
eight papers chosen by
Rui Baptista
Technical University of Lisbon

  1. Product Innovation and Survival in a High-Tech Industry By Roberto Fontana; Lionel Nesta
  2. Entry and exit of firms in a global economy: a cross-country and industry analysis By Colantone, Italo; Sleuwaegen, Leo
  3. Competition and innovative intentions: A study of Dutch SMEs By Jeroen de Jong
  4. The relationship between knowledge management, innovation and firm performance: evidence from Dutch SMEs By André van Stel; Mickey Folkeringa; Joris Meijaard; Lorraine Uhlaner
  5. Entrepreneurship and innovation By Ro Braaksma; Joris Meijaard
  6. The firm and its governance along the industry life cycle By Jackie Krafft; Jacques Laurent Ravix
  7. Creative industries By Jeroen de Jong; Pieter Fris; Erik Stam

  1. By: Roberto Fontana; Lionel Nesta
    Date: 2007
  2. By: Colantone, Italo; Sleuwaegen, Leo (Vlerick Leuven Gent Management School)
    Abstract: This paper examines the impact of international trade on firm entry and exit in Europe. The results point to strong displacement exit and less creative replacement entry in industries characterized by increasing import competition Moreover, the evidence suggests strong selection and higher entry barriers in industries characterized by higher openness through the export channel. The negative effects of trade openness lose importance if the increasing trade exposure concerns intra-industry trade, mainly coupled with international sourcing within the industry.
    Keywords: Globalization, Exit, Entry
    Date: 2008–01–11
  3. By: Jeroen de Jong
    Abstract: This paper explores the complex relationship between competition and innovation. Traditional measures of competition using industry statistics are often challenged andfound wanting. This paper distinguishes between three types of competitive forces: internal rivalry among incumbent firms in an industry, bargaining power of suppliers,and bargaining power of buyers. Using survey data from 2,281 Dutch firms, we apply new perception-based measures for these competitive forces to explore how competition relates to firms innovative intentions. We also investigate the influence of innovation strategy as a contingency variable. Results show that specific innovative intentions, i.e. to invest in product and process innovation, are related to different competitive forces. Process innovation is correlated with the bargaining power of suppliers, while intentions to invest in product innovation are associated with buyer power. Finally, intended product innovation is related to internal rivalry, but only when firms have no innovation strategy.
    Date: 2007–05–30
  4. By: André van Stel; Mickey Folkeringa; Joris Meijaard; Lorraine Uhlaner
    Abstract: This article investigates the relationship between knowledge management (KM), innovation and firm performance of smaller firms (less than 100 employees), based on a panel of more than 400 Dutch firms. Regression analyses explain the variations in sales turnover growth from various measures of KM strategies. We distinguish between KM input, throughput and output (or innovation) strategies. We find that KM input strategies related to knowledge acquisition are positively related to sales turnover growth. In contrast, we do not find a relation between KM throughput and KM output (innovation) measures and firm performance. The results emphasize the importance of both knowledge absorption and knowledge creation to the success of innovative efforts in small firms. This is an updated version of Scales-paper N200322.
    Date: 2007–01–24
  5. By: Ro Braaksma; Joris Meijaard
    Abstract: This report provides an overview of recent facts and figures on start-ups in the Netherlands, techno start-ups in particular and the overall link between entrepreneurship and innovation.
    Date: 2007–12–20
  6. By: Jackie Krafft (GREDEG - Groupe de recherche en Droit Economie Gestion - Université de Nice Sophia-Antipolis); Jacques Laurent Ravix (GREDEG - Groupe de recherche en Droit Economie Gestion - Université de Nice Sophia-Antipolis)
    Abstract: The paper explores this issue by reconciling two trends of literature that are generally disconnected – the industry life cycle (ILC) on the one hand and the governance of large and small firms on the other – to generate results on how the governance of the firm may look like over the industry life cycle. When the two bodies of literature are connected, the immediate result is that the governance of small, young and innovative firms in the early stages of the life cycle should be different from the governance of large, mature and routinized firms. Small young and innovative firms should benefit of a mode of governance based on cooperation and assistance to stimulate innovation, while large mature and routinized firms should be imposed a mode of governance based on control of the manager’s action in the interests of shareholders. We argue that this immediate result can only be but preliminary, since age and size are not necessarily the key determinants of innovative behaviours of firms. In the ILC, small new firms engage product innovations, while large mature firms continue the process of innovation by investing in process capacities . In that perspective, imposing these firms a governance based on control may not be the optimal solution, since we know that this mode of governance favours short term choices that may be detrimental to the development of innovation. What is more important is thus to consider how the innovative behaviour of firms can be maintained in phases of growth and decline of the industry. In the paper, we advance the idea that new principles of governance should be proposed for innovative corporations (large or small) as a distinctive category.
    Date: 2008
  7. By: Jeroen de Jong; Pieter Fris; Erik Stam
    Abstract: Creative industries are nowadays central in many policies to stimulate the economic development of cities, regions and advanced capitalist economies in general. This paper contributes to the  creative industries literature in two respects. First, we empirically explore if high shares of creative industries in regions go together with one particular aspect of regional economic development, namely firm entry rates. Drawing on Dutch trade register data over a six-year period, it is concluded that at the level of municipalities there is indeed a connection between the share of creative industries and firm entry, even after controlling for the sizes of municipalities, and no matter if creative industries are defined broadly or narrowly. Second, the paper analyses if firms in creative industries are heterogeneous in terms of business processes and their contribution to regional firm entry. Drawing on previous work four creative domains are identified: arts, media and entertainment, creative business services and, at the periphery, knowledge intensive business services. After analysing survey data of 4,746 Dutch SMEs, we find that firms across these domains are distinct in their use of the surveyed business practices: innovation, strategy and marketing, and human resources practices. Especially knowledge intensive services firms are deviant. For the connection with firm entry rates, it appears that high shares of firms in the arts and knowledge intensive business services are significantly connected with regional firm entry rates, while media and entertainment and creative business services remain insignificant. Implications for practitioners and future research are discussed.
    Date: 2007–12–20
  8. By: Maud ROUCAN-KANE; David UBILAVA; Pei XU (Department of Agricultural Economics, College of Agriculture, Purdue University)
    Abstract: The objective of this paper is to determine how the firm's infrastructure, the financial characteristics of a company (net income, sales), and the organizational structure (number of acquisitions, age of establishment of the firm) affect R&D investments in the agricultural sector. We use data for companies under the SIC codes for agricultural chemicals, and crop planning and protection. The results based on analysis of 69 observations of 12 firms revealed that firm's financial and organizational infrastructure does affect its R&D expenditures. Older and larger firms tend to spend more on R&D. During the last 17 years the R&D expenditures with respect to the sales of the company have been reduced. Finally, contrary to the expectations, previous year's profit margins are negatively correlated with the R&D over the sales ratio of the following year.
    Keywords: Manufactured Housing; R&D, agriculture, chemicals, crop planning, crop protection, agribusiness, expenditures
    JEL: A10 O32 Q16
    Date: 2007

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