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on Technology and Industrial Dynamics |
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Issue of 2014‒02‒08
six papers chosen by Fulvio Castellacci Norwegian Institute of International Affairs (NUPI) |
| By: | Daron Acemoglu (Department of Economics, Massachusetts Institute of Technology); Ufuk Akcigit (Department of Economic, University of Pennsylvania); Murat Alp Celik (Department of Economic, University of Pennsylvania) |
| Abstract: | This paper argues that openness to new, unconventional and disruptive ideas has a .first-order impact on creative innovations - innovations that break new ground in terms of knowledge creation. After presenting a motivating model focusing on the choice between incremental and radical innovation, and on how managers of different ages and human capital are sorted across different types of .firms, we provide cross-country, firm-level and patent-level evidence consistent with this pattern. Our measures of creative innovations proxy for innovation quality (average number of citations per patent) and creativity (fraction of superstar innovators, the likelihood of a very high number of citations, and generality of patents). Our main proxy for openness to disruption is manager age. This variable is based on the idea that only companies or societies open to such disruption will allow the young to rise up within the hierarchy. Using this proxy at the country, .firm or patent level, we present robust evidence that openness to disruption is associated with more creative innovations. |
| Keywords: | corporate culture, creative destruction, creativity, economic growth, entrepreneurship, individualism, innovation, openness to disruption |
| JEL: | O40 O43 O33 P10 P16 Z1 |
| Date: | 2014–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:14-004&r=tid |
| By: | Shimizu, Hiroshi; Wakutsu, Naohiko |
| Abstract: | By exploring the patterns of laser-diode technological development in the U.S. and Japan and theoretically examining market conditions and institutions that promote entrepreneurial spin-outs from a parental company, this study reveals how the existence and absence of entrepreneurial spin-out influence the ways in which technological trajectories emerge. It shows that vibrant entrepreneurial spin-out could hinder technological development, since the cumulative effects of incremental innovations on the technological trajectories could vanish if many firms spun out to target untapped sub-markets. |
| Keywords: | Innovation, Entrepreneurial Spin-Outs, Technological Trajectory, R&D Competition, Sub-markets, General Purpose Technology |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:hit:iirwps:13-21&r=tid |
| By: | Alexander Eickelpasch |
| Abstract: | This paper investigates to what extent the R&D behavior of manufacturing companies was influenced by the 2008/09 crisis. Based on a broad official data set for German manufacturing companies, only a few companies that engaged in R&D during 2008 gave it up in the following year. Some companies even started R&D during crisis. R&D expenditures declined in 2009 compared to 2008, but expanded in 2010. The development of R&D expenditures was less volatile than sales. Probit analyses show that the occurrence of R&D in 2009 is very much determined by engagement in R&D in 2008 and that changes in demand are not relevant. However, fluctuation in demand proved to be relevant in the regressions computed where the intensity of R&D expenditures was the dependent variable. This result suggests that companies reacted counter cyclically in 2008/09, i.e. the reduction in R&D was smaller than the decline in demand, or the expansion of R&D expenditures was greater than the change in demand. Similar regressions for using R&D staff as the dependent variable did not find any influence of changes in demand. The results suggest that companies see R&D as a longer term task necessary to retain competitiveness. |
| Keywords: | Research and development, Business cycle, Manufacturing |
| JEL: | E32 L60 O31 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1357&r=tid |
| By: | Andrés Rodríguez-Pose; Marco Di-Cataldo |
| Abstract: | Although it has frequently been argued that the quality of institutions affects the innovative potential of a territory, the link between institutions and innovation remains a black box. This paper aims to shed light on how institutions shape innovative capacity, by focusing on how regional government quality affects innovative performance in the regions of Europe. By exploiting new data on quality of government (QoG), we assess how government quality and its components (control of corruption, rule of law, government effectiveness and government accountability) shape patenting capacity across the regions of the European Union (EU). The results of the analysis – which are robust to controlling for the endogeneity of institutions – provide strong evidence of a causal link between the quality of local governments and the capacity of territories to generate innovation. In particular, low quality of government becomes a fundamental barrier for the innovative capacity of the periphery of the EU, strongly undermining any potential effect of any other measures aimed at promoting greater innovation. The results have important implications for the definition of innovation strategies in EU regions. |
| Keywords: | Institutions, Quality of government, Innovation, Regions, Europe |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1406&r=tid |
| By: | Abbring, Jaap H. (Tilburg University); Campbell, Jeffrey R. (Federal Reserve Bank of Chicago); Tilly, Jan (University of Pennsylvania); Yang, Nan (National University of Singapore) |
| Abstract: | This paper develops an econometric model of industry dynamics for concentrated markets that can be estimated very quickly from market-level panel data on the number of producers and consumers using a nested fixed-point algorithm. We show that the model has an essentially unique symmetric Markov-perfect equilibrium that can be calculated from the fixed points of a finite sequence of low-dimensional contraction mappings. Our nested fixed point procedure extends Rust's (1987) to account for the observable implications of mixed strategies on survival. We illustrate the model's empirical application with ten years of County Business Patterns data from the Motion Picture Theaters industry in 573 Micropolitan Statistical Areas. The results are suggestive of fierce competition between theaters in the market for film exhibition rights. |
| Keywords: | demand uncertainty; dynamic oligopoly; firm entry and exit; Markov-perfect equilibrium; nested fixed point estimator; sunk costs; toughness of competition. |
| JEL: | C25 C73 L13 |
| Date: | 2013–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2013-20&r=tid |
| By: | Daron Acemoglu; Mohamed Mostagir; Asuman Ozdaglar |
| Abstract: | Crowdsourcing is an emerging technology where innovation and production are sourced out to the public through an open call. At the center of crowdsourcing is a resource allocation problem: there is an abundance of workers but a scarcity of high skills, and an easy task assigned to a high-skill worker is a waste of resources. This problem is complicated by the fact that the exact difficulties of innovation tasks may not be known in advance, so tasks that require high-skill labor cannot be identified and allocated ahead of time. We show that the solution to this problem takes the form of a skill hierarchy, where tasks are first attempted by low-skill labor, and high-skill workers only engage with a task if less skilled workers are unable to finish it. This hierarchy can be constructed and implemented in a decentralized manner even though neither the difficulties of the tasks nor the skills of the candidate workers are known. We provide a dynamic pricing mechanism that achieves this implementation by inducing workers to self select into different layers. The mechanism is simple: each time a task is attempted and not finished, its price (reward upon completion) goes up. |
| JEL: | D20 D83 L22 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19852&r=tid |