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on Technology and Industrial Dynamics |
| By: | Bakker, Gerben; Crafts, Nicholas; Woltjer, Pieter |
| Abstract: | We develop new aggregate and sectoral total factor productivity (TFP) estimates for the United States between 1899 and 1941 through better coverage of sectors and better measured labor quality, and show TFP growth was lower than previously thought, broadly based across sectors, strongly variant inter-temporally, and consistent with many diverse sources of innovation. we then test and reject three prominent claims. First, the 1930s did not have the highest TFP growth of the twentieth century. Second, TFP growth was not predominantly caused by four leading sectors. Third, TFP growth was not caused by a 'yeast process' originating in a dominant technology such as electricity. |
| Keywords: | growth; Harberger diagram; mushrooms; productivity growth; TFP |
| JEL: | N11 N12 O47 O51 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10995&r=tid |
| By: | Filippo Belloc |
| Abstract: | We analyse how countries' innovation outcomes are affected by national legislations of worker participation to corporate governance. We develop a model of employee representation laws (ERL) and innovation in the presence of incomplete labour contracts and predict heterogeneous ERL effects across different systems of dismissal regulation. We then perform a panel regression analysis, exploiting 2-digit panel data for 21 manufacturing sectors of USA, UK, India, France and Germany, over the 1977-2005 period. We find that ERL effects on aggregate innovation output are positive, statistically significant and higher in magnitude where national labour laws impose significant ring costs to the firm with respect to institutional settings in which ring costs are low or absent. These results are robust to possible technology selection dynamics, endogeneity and institutional changes in the legal system of patent protection. We also estimate ERL effects on innovation conditional on ring costs at an industry level and show that the impact of ERL is relatively larger in those sectors where the human capital contribution to production is higher. Our results have relevant implications for the optimal design of employee representation legislations. |
| Keywords: | employee representation law, innovation, panel data |
| JEL: | K31 O31 P51 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:719&r=tid |
| By: | Peters, Bettina; Roberts, Mark J.; Vuong, Van Anh |
| Abstract: | This article investigates how a firm's financial strength affcts its dynamic decision to invest in R&D. We estimate a dynamic model of R&D choice using data for German firms in high-tech manufacturing industries. The model incorporates a measure of the firm's financial strength, derived from its credit rating, which is shown to lead to substantial differences in estimates of the costs and expected long-run benefits from R&D investment. Financially strong firms have a higher probability of generating innovations from their R&D investment, and the innovations have a larger impact on productivity and profits. Averaging across all firms, the long run benefit of investing in R&D equals 6.6 percent of firm value. It ranges from 11.6 percent for firms in a strong financial position to 2.3 percent for firms in a weaker financial position. |
| Keywords: | R&D choice,Financial strength,Innovation,Productivity,Dynamic structural model |
| JEL: | O31 O32 G30 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:15083&r=tid |
| By: | Coad, Alex (University of Sussex); Daunfeldt, Sven-Olov (HUI Research and Dalarna University); Halvarsson, Daniel (The Ratio institute) |
| Abstract: | Is firm growth more persistent for young or old firms? Theory gives us no clear answer, and previous empirical investigations have been hampered by a lack of detailed data on firm age, as well as a non-representative coverage of young firms. We overcome these shortcomings using a rich dataset on all limited liability firms in Sweden during 1997-2010, covering firms of all ages and information on registered start year. We find that sales growth for new ventures is characterized by positive persistence, whereas it quickly turns negative and remains negative as firms get older. It thus seems that the growth paths of older firms are buffeted around by environmental turbulence, and that older firms may have challenges in adapting their strategies to changing market conditions, whereas new firms experience an early burst of sustained growth. |
| Keywords: | Firm age; growth rate autocorrelation; sales growth; learning-bydoing; minimum efficient scale |
| JEL: | D22 L25 L26 |
| Date: | 2015–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0264&r=tid |
| By: | Reinhilde Veugelers |
| Abstract: | Highlights The European Union has prioritised the pursuit of innovation based growth and targeting of resources to promote research and development, but performance on innovation remains weak. With the lack of results comes fatigue, waning interest and mounting criticism about policy. Should the EU abandon its ambition to become the most innovative region in the world? We examine EU member state research and innovation policies. We assess whether the deployment of innovation policy instruments in EU countries matches their innovation capacity performance relative to other EU countries. We find a relative homogeneity of policy mixes in EU countries, despite the fairly wide and stable differences in their innovation capacities. Our analysis therefore provides a rationale for a more comprehensive review of innovation policy mixes to assess their adequacy in addressing country specific innovation challenges. |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:11543&r=tid |
| By: | Daunfeldt, Sven-Olov (HUI Research and Dalarna University); Halvarsson, Daniel (The Ratio Institute); Mihaescu, Oana (HUI Research and Dalarna University) |
| Abstract: | High-growth firms have received considerable interest recently since they create most of the new jobs in the economy. The purpose of our paper is to investigate the characteristics of high-growth firms prior to their growth period, and whether these characteristics differ across industries. Using data on a large sample of limited liability firms in Sweden for the period 2007-2010, we find that high-growth firms do not have the characteristics that we typically associate with successful firms. On the contrary, our results indicate that high-growth firms have low profits and a weak financial position. This might explain why studies have found that high-growth firms are seldom capable of sustaining their high growth rates in subsequent periods, and thus question policies that are targeted towards these companies. |
| Keywords: | Entrepreneurship; Firm growth; Gazelles; High-growth firms; High-impact firms; Innovation |
| JEL: | L11 L25 |
| Date: | 2015–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0263&r=tid |
| By: | Caliendo, Lorenzo; Mion, Giordano; Opromolla, Luca David; Rossi-Hansberg, Esteban |
| Abstract: | The productivity of firms is, at least partly, determined by a firm’s actions and decisions. One of these decisions involves the organization of production in terms of the number of layers of management the firm decides to employ. Using detailed employer-employee matched data and firm production quantity and input data for Portuguese firms, we study the endogenous response of revenue-based and quantity-based productivity to a change in layers: a firm reorganization. We show that as a result of an exogenous demand or productivity shock that makes the firm reorganize and add a management layer, quantity-based productivity increases by about 4%, while revenue-based productivity drops by more than 4%. Such a reorganization makes the firm more productive, but also increases the quantity produced to an extent that lowers the price charged by the firm and, as a result, its revenue-based productivity. |
| Keywords: | firm size; layers; managers; organization; productivity; TFP; wages |
| JEL: | D22 D24 F16 J24 J31 L23 |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10993&r=tid |
| By: | Engel, Dirk; Rothgang, Michael; Eckl, Verena |
| Abstract: | The paper analyses how context and time dependent factors determine the impulse of R&D subsidies on firm behavior with respect to private R&D expenditures. Based on data from the German R&D survey, we combine propensity-score matching with a difference-in-difference-estimator in order to measure the causal influence of public direct R&D project funding on firm behavior. Our results indicate that (i) repeated participation in R&D projects on average leads to a higher increase in R&D expenditures than one-time funding; (ii) the aggregate effect of R&D funding on R&D expenditures of business firms is somewhat higher for business and business collaboration projects than for science and business collaboration projects; (iii) R&D expenditures of business firms that cooperate with science show a higher share of external R&D spending. Results of one particular cluster programme indicate that at least the short-term development of R&D does not so much depend on which programme direct R&D project funding is applied to. |
| Keywords: | R&D,public subsidies,collaboration,policy evaluation |
| JEL: | C14 C25 H50 O38 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:587&r=tid |
| By: | Heinrich, Torsten; Dai, Shuanping |
| Abstract: | Among the phenomena in economics that are not yet well-understood is the fat-tailed (power-law) distribution of firm sizes in the world´s economies. Different mechanisms suggested in the literature to explain this distribution of firm sizes are discussed in the present paper. The paper uses the China Industrial Enterprises Database to study the distribution (firm size in terms of the number of employees, capital, and gross profit) for the provinces of China for the years 1998-2008. We estimate the power-law distribution and confirm its plausibility using the KS test and the log-likelihood ratio vs. lognormal and exponential distributions. The analysis on regional levels allows an assessment of regional effects on differences in the distribution; we discuss possible explanations for the observed patterns in the light of the recent regional economic development in the PRC. |
| Keywords: | firm size distribution,evolutionary industry dynamics,power-law distribution,China |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:udedao:1072015&r=tid |