|
on Technology and Industrial Dynamics |
| By: | Norbäck, Pehr-Johan (Research Institute of Industrial Economics (IFN)); Persson, Lars (Research Institute of Industrial Economics (IFN)); Svensson, Roger (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We develop a theory of commercialization mode (entry or sale) of entrepreneurial inventions into oligopoly, and show that an invention of higher quality is more likely to be sold (or licensed) to an incumbent due to strategic product market effects on the sales price. Moreover, preemptive acquisitions by incumbents are shown to stimulate the process of creative destruction by increasing the entrepreneurial effort allocated to high-quality invention projects. Using detailed data on patents granted to small firms and individuals, we find evidence that high-quality inventions are often sold, and that they are sold under bidding competition. |
| Keywords: | Acquisitions; Entrepreneurship; Innovation; Start-ups; Patent; Ownership; Quality |
| JEL: | G24 L10 L20 M13 O30 |
| Date: | 2009–06–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0799&r=tid |
| By: | Dirk Czarnitzki; Federico Etro; Kornelius Kraft |
| Abstract: | We develop a simple model of competition for the market that shows that, contrary to the Arrow view, endogenous entry threat in a market induces the average firm to invest less in R&D and the incumbent leader to invest more than the average firm. We test these predictions with a Tobit model based on a unique dataset and survey for the German manufacturing sector (the Mannheim Innovation Panel). In line with our predictions, endogenous entry threats perceived by the firms reduce R&D intensity for the average firm, but not for an incumbent leader. Moreover, the size of the firms and their patent stocks, proxy for the protection of IPRs, are positively related to R&D intensity. These results hold after a number of robustness tests with instrumental variables. |
| Keywords: | R&D, Entry, Endogenous market structures, Leadership |
| JEL: | O31 O32 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:163&r=tid |
| By: | Moritz Müller; Robin COWAN; Geert Duysters; Nicolas JONARD |
| Abstract: | This paper investigates how technological distance between firms affects their network of R&D alliances. Our theoretic model assumes that the benefit of an alliance between two firms is given by their technological distance. This benefit-distance relationship determines the ego-network of each firm as well as the overall network structure. Empirical relevance is confirmed for the bio-pharmaceutical industry. Although we find that the network structure is largely explained by firm size, technological distance determines the positioning of firms in the network. |
| Keywords: | technological distance, research alliance, network formation, pharmaceutical industry. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2009-24&r=tid |
| By: | David Flath |
| Abstract: | This paper explores a panel data set matching establishment-based production statistics from Japan's Census of Manufacturers with wholesale price indices from the Bank of Japan, and Herfindahl indices from the Japan Fair Trade Commission. The data include annual observations over the period 1961-1990, for 74 industries at the 4-digit s.i.c. level. We estimate Cobb-Douglas production functions and Solow residuals for each industry and then use these estimates to further analyze the determinates of industrial concentration and innovation. The industries having great capital intensity, small employment of labor, and with high price-cost margins tend to be more concentrated. Cross-section estimates reveal a U-shaped mapping from concentration to innovation. |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0739&r=tid |
| By: | Toshihiro Matsumura; Noriaki Matsushima |
| Abstract: | This paper investigates an asymmetric duopoly model with a Hotelling line. We find that helping a small (minor) firm can reduce both social and consumer surplus. This makes a sharp contrast to existing works showing that helping minor firms can reduce social surplus but always improves consumer surplus. We also investigate R&D competition. We find that a minor firm may engage in R&D more intensively than a major firm in spite of economies of scale in R&D activities. |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0742&r=tid |
| By: | Klaus Desmet (Universidad Carlos III de Madrid); Stephen L. Parente (University of Illinois) |
| Abstract: | This paper argues that an economy\'s transition from Malthusian stagnation to modern growth requires markets to reach a critical size, and competition to reach a critical level of intensity. By allowing an economy to produce a greater variety of goods, a larger market makes goods more substitutable, raising the price elasticity of demand, and lowering mark-ups. Firms must then become larger to break even, which facilitates amortizing the fixed costs of innovation. We demonstrate our theory in a dynamic general equilibrium model calibrated to England\'s long-run development and explore how various factors affect the timing of takeoff. |
| Keywords: | competition; industrial revolution; innovation; market revolution; unified growth theory |
| JEL: | N33 O14 O33 O41 |
| Date: | 2009–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:imd:wpaper:wp2009-06&r=tid |