nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2011‒09‒16
four papers chosen by
Rui Baptista
Technical University of Lisbon

  1. Innovation and Corporate Dynamics: A Theoretical Framework By Jakub Growiec; Fabio Pammolli; Massimo Riccaboni
  2. Is the Dragon Learning to Fly? An Analysis of the Chinese Patent Explosion By Markus Eberhardt; Christian Helmers; Zhihong Yu
  3. Competition and Innovation By Michele Boldrin; Juan C Allamand; David K Levine; Carmine Ornaghi
  4. A Corporation's Culture as an Impetus for Spinoffs and a Driving Force of Industry Evolution By Christian Cordes; Peter J. Richerson; Georg Schwesinger

  1. By: Jakub Growiec; Fabio Pammolli; Massimo Riccaboni
    Abstract: We provide a detailed analysis of a model of innovation and corporate dy- namics that encompasses the Gibrat’s Law of Proportionate Effect and the Simon growth process as particular instances. The predictions of the model are derived in terms of (i) firm size distribution, (ii) the distribution of firm growth rates, and (iii-iv) the relationships between firm size and the mean and variance of firm growth rates. We test the model against data from the worldwide pharmaceutical industry and find its predictions to be in good agreement with empirical evidence on all four dimensions.
    Keywords: Business firm size; firm growth distribution; GibratÕ Law; Pareto distribution; lognormal distribution, size-variance relationship.
    JEL: C49 L11 L25 L65
    Date: 2011–08
  2. By: Markus Eberhardt; Christian Helmers; Zhihong Yu
    Abstract: This paper analyses characteristics and determinants of the recent explosion of patent filings by Chinese firms both in China and the United States. We construct a firm-level dataset by matching USPTO and SIPO patents to Chinese manufacturing census data for the period 1999-2006. Using this integrated firm-level dataset, we show that the patent explosion is accounted for by a tiny, highly select group of Chinese companies in the information & communication technology (ICT) equipment industry. This handful of ICT companies accounts for nearly all Chinese USPTO patent filings as well as the vast majority of domestic SIPO patents despite there being a larger number of Chinese companies distributed across a wider range of industries that seeks patent protection domestically. Our empirical analysis further suggests that firms patenting in both US and China are considerably younger, larger and substantially more export-oriented than firms patenting exclusively in China. Our study contributes to the debate on China’s innovative prowess and its potential to transition from an imitator to an innovator economy.
    Keywords: China, firm, patents.
    JEL: L25 O12
    Date: 2011
  3. By: Michele Boldrin; Juan C Allamand; David K Levine; Carmine Ornaghi
    Date: 2011–08–29
  4. By: Christian Cordes; Peter J. Richerson; Georg Schwesinger
    Abstract: In infant industries, a great share of new market opportunities is depleted by firms that spinoff from incumbents. A model emphasizing the relation between incumbents' evolving corporate cultures and the generation of spinoffs explains this regularity in industry evolution. Organizations reach a critical size that entails the collapse of a cooperative culture and triggers the exodus of personnel founding own firms. Thereby, organizations with a cooperative culture active in a dynamic business environment provide ideal training grounds for potential founders. We relate our findings to empirical evidence on developmental patterns in industries, such as genealogies and performance of spinoffs.
    Keywords: Spinoff Formation, Critical Firm Size, Firm Performance, Industry Evolution, Corporate Culture Length 23 pages
    JEL: C61 D21 L25 L26 M13 M14
    Date: 2011–08

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