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on Technology and Industrial Dynamics |
| By: | Haufler, Andreas (University of Munich); Norbäck, Pehr-Johan (Research Institute of Industrial Economics (IFN)); Persson, Lars (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Many governments promote small businesses for the dual reasons of fostering ‘breakthrough’ innovations and employment growth. In this paper we study the effects of tax and subsidy policies on entrepreneurs’ choice of riskiness of an innovation project and on their mode of commercializing the innovation (market entry versus sale). Limited loss offset provisions in the tax system induce entrepreneurs to choose projects with too little risk and this problem arises primarily when entrepreneurs market their product themselves. When innovations reduce only the fixed costs of production this leads to a fundamental policy trade-off between the declared goals of promoting employment and innovation in small, entrepreneurial firms. When innovations reduce variable production costs, policies to promote small businesses may even be unambiguously harmful. |
| Keywords: | Entrepreneurship; Innovation; Corporate taxes; Firm growth |
| JEL: | H25 L13 M13 O31 |
| Date: | 2012–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0896&r=tid |
| By: | Julien Jacob |
| Abstract: | We suggest a model of innovation and diffusion of a new technology in which two firms, one innovative and one non-innovative, undertake risky activities that are regulated by liability rules. One originality of this study is to consider the presence of a “double-impact” innovation, impacting both the cost of risk prevention and the probability of accident. We compare strict liability and negligence in terms of incentives to innovate, to adopt the new technology and to prevent the risk. We find that the type of innovation and the behavior of the Regulator play key roles: when the Regulator acts as a “leader”, a negligence rule is socially preferable if the innovation mainly impacts the cost of risk prevention. In other cases (Regulator as a “follower” and/or innovation with sufficiently high impact on the probability of accident), strict liability is preferable. |
| Keywords: | Innovation, technological risk, strict liability, negligence. |
| JEL: | E2 E5 E6 F3 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2011-24&r=tid |
| By: | Gans, Joshua S. (Rotman School of Management); Persson, Lars (Research Institute of Industrial Economics (IFN)) |
| Abstract: | This paper examines the interaction between intellectual property protection and competition policy on the choice of entrepreneurs with respect to commercialization as well as the rate of innovation. We find that stronger intellectual property protection makes it more likely that entrepreneurs will commercialize by cooperating with incumbents rather than competing with them. Consequently, we demonstrate that competition policy has a clearer role in promoting a higher rate of innovation in that event. Hence, we identify one reason why the strength of the two policies may be complements from the perspective of increasing the rate of entrepreneurial innovation. |
| Keywords: | Entrepreneurs; Innovation; Commercialization; Intellectual property law; Competition law |
| JEL: | O31 |
| Date: | 2012–01–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0895&r=tid |
| By: | Marco Vivarelli |
| Abstract: | This paper critically discusses the theoretical and empirical literature on the quantitative and qualitative employment impact of technological change, compares the relative explanatory power of the competing theories, and explains in detail the macro and micro evidence on the issue, with reference both to the advanced economies and the developing countries (DCs). |
| Keywords: | Science & Technology :: New Technologies, Science & Technology, Technology, innovation, employment, skill, skill-biased technological change |
| JEL: | O33 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:61058&r=tid |