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on Technology and Industrial Dynamics |
| By: | Mariana Mazzucato (SPRU, University of Sussex, UK); Carlota Perez (SPRU, University of Sussex, UK; London School of Economics, UK; Nurkse Institute, Estonia) |
| Keywords: | Growth policy, innovation, green growth, inclusive growth, technological revolutions, role of government, mission-oriented investments, value creation, definancialisation, respecialisation |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:sru:ssewps:2014-13&r=tid |
| By: | Lopez-Rodriguez, Jesus; Martinez, Diego |
| Abstract: | Although non-R&D innovation activities account for a significant portion of innovation efforts carried out across very heterogeneous economies in Europe, how to incorporate them in to economic models is not always straightforward. For instance, the traditional macro approach to estimating the determinants of total factor productivity (TFP) does not handle them well. To counter these problems, this paper proposes applying an augmented macro-theoretical model to estimate the determinants of TFP by jointly considering the effects of R&D and the impact of non-R&D innovation activities on the productivity levels of firms. Estimations from a model of a sample of EU-26 countries covering the period 2004-2008 show that the distinction between R&D and non-R&D effects is significant for a number of different issues. First, the results show a sizeable impact on TFP growth, as the impact of R&D is twice that of non-R&D. Second, absorptive capacity is only linked to R&D endowments. And third, the two types of endowments cannot strictly been seen as complementary, at least for the case of countries with high R&D intensities or high non-R&D intensities. |
| Keywords: | TFP; R&D; non-R&D expenditures; EU countries |
| JEL: | O0 O3 O4 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2014/5&r=tid |
| By: | Pedro Bento; Diego Restuccia |
| Abstract: | We construct a new dataset using census, survey, and registry data from hundreds of sources to document a clear positive relationship between aggregate productivity and average establishment size for manufacturing establishments across 124 countries. We rationalize this relationship using a standard model of reallocation among production units that features endogenous entry and productivity investment. The model connects small operational scales in poor countries to the prevalence in these countries of correlated distortions (the elasticity between wedges and establishment productivity). The model also rationalizes the low establishment-level productivity and aggregate investment found in poor countries. A calibrated version of the model implies that when correlated distortions change from 0.13 in the U.S. to 0.56 in India, establishment size and productivity fall by a factor of six. These substantial size and productivity losses are large compared to the existing literature and more in line with actual data for the differences in size and productivity between India and the United States. |
| Keywords: | misallocation, establishment size, productivity, investment, idiosyncratic distortions. |
| JEL: | O1 O4 |
| Date: | 2014–07–25 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-517&r=tid |
| By: | Stephen Roper (Warwick University Business School); Helen Xia (Loughborough University) |
| Abstract: | Innovation has a recognised effect on survival. Undertaking more risky innovation, for example, may increase the risk of business failure, while more incremental innovation may reduce failure risk. Here, we investigate how firms’ innovation strategy choices – which may reduce the riskiness or costs of innovation and/or increase the innovation rewards – moderate the innovation-survival relationship. Our analysis is based on UK Community Innovation Survey data matched with survival data from firms’ published accounts. We are able to match nearly 80 per cent of UK CIS respondents. Contrary to expectations we find that innovation partnering and intellectual property protection have little or no moderating effect on the innovation-survival relationship. However, receiving public support for innovation has significant positive moderating effects. This suggests the notion of “survival additionality”, i.e. firms receiving public support derive more persistent benefits from innovation than firms which did not receive public support. Specifically, firms which receive public support for innovation are 2.7 per cent more likely to survive for eight years than firms which innovate but without public support. This result is strongest for product and service rather than process change, with implications for innovation policy design and evaluation. |
| Keywords: | Innovation, survival, strategy, public support, additionality, UK |
| JEL: | O32 L1 O38 Q34 L26 |
| Date: | 2014–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:enr:rpaper:0017&r=tid |
| By: | Stephen Roper (Warwick University Business School); Nola Hewitt-Dundas (Queen's University Belfast) |
| Abstract: | In many countries significant amounts of public funding are devoted to supporting firms’ R&D and innovation projects. Here, using panel data on the innovation activities of Irish manufacturing firms we examine the legacy effects of public subsidies for new product development and R&D. We examine five alternative mechanisms through which such effects may occur: input additionality, output additionality, and congenital, inter-organisational and experiential behavioural additionality. Tests suggest contrasting legacy effects with R&D subsidies generating legacy output additionality effects while new product development subsidies have legacy congenital and inter-organisational behavioural additionality effects. Our results have implications for innovation policy design and evaluation. |
| Keywords: | innovation policy, additionality, evaluation, Ireland |
| JEL: | O32 L1 O38 Q34 L26 |
| Date: | 2014–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:enr:rpaper:0021&r=tid |
| By: | Stuart McDonald (School of Economics, The Universty of Queensland); Joanna Poyago-Theotoky (School of Economics, La Trobe University Rimini Centre for Economic Analysis (RCEA)) |
| Abstract: | We examine the impact of an optimal emissions tax on research and development of emission reducing green technology (E-R&D) in the presence of R&D spillovers. We show that the size and effectiveness of the optimal emissions tax depends on the type of the R&D spillover: input or output spillover. In the case of R&D input spillovers (where only knowledge spillovers are accounted for), the optimal emissions tax required to stimulate R&D is always higher than when there is an R&D output spillover (where abatement and knowledge spillovers exist simultaneously). We also find that optimal emissions taxation and cooperative R&D complement each other when R&D spillovers are small, leading to lower emissions. |
| Keywords: | Environmental R&D, Green Technology, R&D Spillover, Emissions Tax |
| JEL: | H23 L11 Q55 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2014.59&r=tid |