nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2009‒05‒02
six papers chosen by
Rui Baptista
Technical University of Lisbon

  1. On Competition and the Strategic Management of Intellectual Property in Oligopoly By Jos Jansen
  2. Technology diversification, product innovations, and technology transfer By Martin Woerter
  3. Innovation and Market Design By Peter Cramton
  4. On R&D, medium and high-tech industries and productivity: an application to the Portuguese case By Celeste Amorim Varum; Bruno Cibrão
  5. Endogenous technological progress and the cross section of stock returns By Lin, Xiaoji
  6. Firm size and growth opportunities: a survey By A. Arrighetti; A. Ninni

  1. By: Jos Jansen (Max Planck Institute for Research on Collective Goods)
    Abstract: An innovative firm chooses strategically whether to patent its process innovation or rely on secrecy. By doing so, the firm manages its rival’s beliefs about the size of the innovation, and affects the incentives in the product market. Different measures of competitive pressure in the product market have different effects on the equilibrium patenting choices of an innovative firm with unknown costs and probabilistic patent validity. Increasing the number of firms (degree of product substitutability) gives a smaller (greater) patenting incentive. Switching from Bertrand to Cournot competition gives a smaller (greater) patenting incentive if patent protection is weak (strong).
    Keywords: Bertrand and Cournot competition, oligopoly, product differentiation, entry, asymmetric information, strategic disclosure, stochastic patent, trade secret, process innovation, imitation
    JEL: D82 L13 O31 O32
    Date: 2009–04
  2. By: Martin Woerter (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: This paper investigates the relationship between technology specialization and innovation performance of firms emphasizing technology transfer activities with universities as an important knowledge source in order to attenuate the opportunity costs of technological specialization. Based on an econometric analysis combining patent data and survey data on technology transfer activities of firms it was found that technology transfer is positively related with the sales share of innovative products. Following the “technology trajectory (path)” increases the probability of an above average innovation performance. Taking into account the combined effects of transfer activities and technological specialization and in this way approximating the idea that transfer activities enable a firm to be specialized and keep the knowledge base broad and upto-date, we detect a significant positive relationship between the combined effect (transfer and specialization) and the innovation performance of a firm. Smaller firms tend to benefit more from the combination of technology specialization and transfer activities with universities compared to larger firms.
    Keywords: Innovation, Knowledge and Technology Transfer, Specialization, Diversification, Firms History
    Date: 2009–04
  3. By: Peter Cramton (Economics Department, University of Maryland)
    Abstract: Market design plays an essential role in promoting innovation. I examine emission allowance auctions, airport slot auctions, spectrum auctions, and electricity markets, and demonstrate how the market design can encourage innovation. Improved pricing information is one source of innovation. Enhancing competition is another driver of innovation seen in all of the applications. Market design fosters innovation in other ways as well by addressing other potential market failures.
    Keywords: Auctions, market design, innovation
    JEL: D44
    Date: 2009
  4. By: Celeste Amorim Varum (Departamento de Economia e Gestão Industrial, Universidade de Aveiro); Bruno Cibrão (Departamento de Economia e Gestão Industrial, Universidade de Aveiro)
    Abstract: This paper investigates the potential impact of increased R&D efforts and structural changes in Portugal on labour productivity. The paper addresses Portugal’s ambition, expressed in the 2005 Technological Plan. Based on existing literature on the relation between R&D expenditures, structural change and productivity, we evaluate the contribution of R&D and medium to high-tech industries on productivity over the last 30 years. Our results confirm the importance of governement’s R&D and of business R&D in the medium to high-tech sectors, as they stimulate productivity growth. However, we cannot hypothesize that productivity growth was primarily rooted on the development of medium-high technology industries.
    Keywords: Manufacturing, Productivity, Structural Change, R&D, High-tech industries
    JEL: O30 O40
    Date: 2008–12
  5. By: Lin, Xiaoji
    Abstract: I study the cross sectional variation of stock returns and technological progress using a dynamic equilibrium model with production. In the model, technological progress is endogenously driven by R&D investment and is composed of two parts. One part is product innovation devoted to creating new products; the other part is dedicated to increasing the productivity of physical investment and is embodied in new tangible capital (e.g., structures and equipment). The model breaks the symmetry assumed in standard models between intangible capital and tangible capital, in which the accumulation processes of tangible capital stock and intangible capital stock do not affect each other. The model explains qualitatively and in many cases quantitatively well-documented empirical regularities: (i) the positive relation between R&D investment and the average stock returns; (ii) the negative relation between physical investment and the average stock returns; and (iii) the positive relation between book-to-market ratio and the average stock returns.
    Keywords: Technological Progress; R&D Investment; Physical Investment; Stock Return
    JEL: E6
    Date: 2009–01–15
  6. By: A. Arrighetti; A. Ninni
    Abstract: The qualifying aspect of the ongoing changes in firm growth processes seems to be the increased heterogeneity of size and a trend towards a broader fluctuation in average size. Exogenous factors (market size, demand trends, technological innovations, higher competition) determine a different impact on firms will to increase their own size, while endogenous variables play a greater role than in the past. The outcome is represented by a growth pattern that characterises some firms, but not all of them. Growth appear to be an asymmetric phenomenon, involving selectively but not casually a subgroup of firms. In the present paper it is hypothesized that growth stems from the asymmetric distribution of internalized resources (both material and immaterial), allowing some firms (regardless of the original size) to enter evolutionary paths that others don’t want or simply can’t enter.
    Keywords: Firm Growth, Size Distribution, Gibrat’s Law, Industrial Dynamics, Human Capital, Intangible Assets, Industrial Policy
    JEL: L11 L25
    Date: 2009

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