nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2021‒01‒04
fifteen papers chosen by
Fulvio Castellacci
Universitetet i Oslo

  1. The Effect of Climate Policy on Productivity and Cost Pass-Through in the German Manufacturing Sector By Beat Hintermann; Maja Žarković; Corrado Di Maria; Ulrich J. Wagner
  2. The Diffusion of Technological Progress in ICT By Steffen Elstner; Christian Grimme; Valentin Kecht; Robert Lehmann
  3. Lockdowns and Innovation: Evidence from the 1918 Flu Pandemic By Enrico Berkes; Olivier Deschenes; Ruben Gaetani; Jeffrey Lin; Christopher Severen
  4. Firm Patenting and Types of innovation in Least Developed Countries. An Empirical Investigation on Patenting Determinants By Mounir Amdaoud; Christian Le Bas
  5. From Discovery to Commercialization: Accretive Intellectual Property Strategies among Small, Knowledge-Based Firms By Hayter, Christopher; Link, Albert
  6. Do the 'smart kids' catch up? Technological capabilities, globalisation and economic growth By Claudius Graebner; Philipp Heimberger; Jakob Kapeller
  7. Robot Imports and Firm-Level Outcomes By Alessandra Bonfiglioli; Rosario Crinò; Harald Fadinger; Gino Gancia
  8. How cumulative is technological knowledge? By P. G. J. Persoon; R. N. A. Bekkers; F. Alkemade
  9. The present, past, and future of labor-saving technologies By Jacopo Staccioli; Maria Enrica Virgillito
  10. Carbon Footprints of European Manufacturing Jobs: Stylized Facts and Implications for Climate Policy By U.J. Wagner; D. Kassem; A. Gerster; J. Jaraite-Kazukauske; M. Klemetsen; M. Laukkanen; J. Leisner; R. Martin; J.R. Munch; M. Muûls; A.T. Nielsen; L. de Preux; K.E. Rosendahl; S. Schusser
  11. Organizational Drivers of Innovation: The Role of Workforce Agility By F. Landini; C. Franco
  12. Downstream new product development and upstream process innovation By Akio Kawasaki; Tomomichi Mizuno; Kazuhiro Takauchi
  14. Government financing of R&D: A mechanism design approach By Saul Lach; Zvika Neeman; Mark Schankerman
  15. Does robotization affect job quality? Evidence from European regional labour markets By José-Ignacio Antón; Enrique Fernández-Macías; Rudolf Winter-Ebmer

  1. By: Beat Hintermann; Maja Žarković; Corrado Di Maria; Ulrich J. Wagner
    Abstract: We investigate productivity and cost pass-through of German manufacturing firms using administrative data from 2001 to 2014. Our framework allows for the estimation of quantity-based production functions for multi-product firms while controlling for unobserved productivity shocks and unobserved input quality. Using our parameter estimates, we can compute total factor productivity, markups and marginal costs. We find no effect of the EU ETS on firm productivity or profits for the whole sector, and a positive effect for some industries. Firms pass on shocks to materials costs completely, or even more than completely, whereas pass-through of energy costs is around 35-60%. Although pass-through of energy costs is incomplete, it nevertheless allowed firms to recover more than their total carbon costs due to generous free allocation of allowances. Our results add to the recent literature concerning the causal effects of climate policy on firms and are relevant for policy makers when defining the level of free allowance allocation to industry.
    Keywords: productivity, production function, cost pass-through, EU ETS, climate policy
    JEL: D24 H23 Q52 Q54
    Date: 2020–12
  2. By: Steffen Elstner; Christian Grimme; Valentin Kecht; Robert Lehmann
    Abstract: We study whether technology gains in sectors related to Information and Communications Technology (ICT) increase productivity in the rest of the economy. To separate exogenous gains in ICT from other technological progress, we use the relative price of ICT goods and services in a structural VAR with medium-run restrictions. Using local projections to estimate the effect of ICT-related technology gains on sectoral technology (TFP), we find two sets of results. First, since the mid-2000s there have been positive and persistent technology spillovers to sectors intensively using ICT. Second, neglecting leasing activity leads to an overestimation of the TFP response for all sectors except the leasing sector, where it is strongly underestimated.
    Keywords: digitization, information and communications technology, technology shocks, local projections, structural VARs, medium-run restrictions, growth accounting
    JEL: C32 D24 E22 E24 O33 O47 O52
    Date: 2020
  3. By: Enrico Berkes; Olivier Deschenes; Ruben Gaetani; Jeffrey Lin; Christopher Severen
    Abstract: Does social distancing harm innovation? We estimate the effect of non-pharmaceutical interventions (NPIs)—policies that restrict interactions in an attempt to slow the spread of disease—on local invention. We construct a panel of issued patents and NPIs adopted by 50 large US cities during the 1918 flu pandemic. Difference-in-differences estimates show that cities adopting longer NPIs did not experience a decline in patenting during the pandemic relative to short-NPI cities, and recorded higher patenting afterward. Rather than reduce local invention by restricting localized knowledge spillovers, NPIs adopted during the pandemic may have better preserved other inventive factors.
    JEL: N92 O31 R11
    Date: 2020–11
  4. By: Mounir Amdaoud (CEPN - Centre d'Economie de l'Université Paris Nord - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord - USPC - Université Sorbonne Paris Cité - LABEX ICCA - UP13 - Université Paris 13 - Université Sorbonne Nouvelle - Paris 3 - CNRS - Centre National de la Recherche Scientifique - UP - Université de Paris - Université Sorbonne Paris Nord); Christian Le Bas
    Abstract: This paper aims to account for the determinants of firm patenting behaviour in developing countries. The literature has accumulated numerous evidence and trends as far as developed countries' firm patenting is concerned. However, only a small amount of information concerning least developed countries' firm patenting is available. With the present study we wish to fill this gap creatively. The core assumption of this paper is that the occurrence of firm patenting is positively related with innovation strategies. As a result we place the emphasis on the diverse ways to innovate and account for the effects on a firm's probability to patent. Our findings indicate that despite the weaknesses of their patenting system in least developed countries (LDCs) there is no huge gap between the determinants of patenting behaviour from firms in these countries, and those the literature considers to be important for developed countries firms.
    Keywords: Patent,appropriation,innovation,developing economies. JEL Codes : O31,O32,O33,O34
    Date: 2020–12–12
  5. By: Hayter, Christopher (Arizona State University); Link, Albert (University of North Carolina at Greensboro, Department of Economics)
    Abstract: This paper explores the use of publications and patents and their covariates among small, knowledge-based firms pursuing technology commercialization. It does so through an empirical examination of 1180 small firms’ R&D projects, all of which were funded through Phase II U.S. Small Business Innovation Research (SBIR) awards. As such, the paper responds to recent calls to investigate not only how small, knowledge-based firms utilize specific IP strategies, but also how accretive logic specifically differs from competitive publishing and patenting logic.
    Keywords: Patents; Publications; Intellectual property; R&D; Strategy;
    JEL: L21 L26 O32 O34
    Date: 2020–12–14
  6. By: Claudius Graebner (Institute for Socio-Economics, University of Duisburg-Essen, Germany; Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; ZOE Institute for future-fit Economies, Bonn, Germany); Philipp Heimberger (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Vienna Institute for International Economic Studies (wiiw), Vienna, Austria); Jakob Kapeller (Institute for Socio-Economics, University of Duisburg-Essen, Germany; Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)
    Abstract: This paper analyses the impact of technological capabilities on convergence. While looking at the relevance of differences in technological capabilities has a long tradition in economics when it comes to explaining persistent deviations in income, we provide econometric tests on the role of technology in determining convergence outcomes in a growth regression framework. We exploit recent advances in measuring technological capabilities for a global country sample over the period 1985-2014. Our results show that convergence is conditional on technological capabilities. This finding is robust to controlling for economic globalisation, resource dependence, institutional quality and other confounding factors. The initial stock of accumulated technological capabilities is one essential factor that may allow poorer countries to convergence towards higher income levels in rich countries. A successful catching-up process cannot be expected for countries lacking a sufficient stock of previously accumulated technological capabilities.
    Keywords: Economic complexity, technology, convergence, catch-up, globalisation, openness
    Date: 2020–12
  7. By: Alessandra Bonfiglioli; Rosario Crinò; Harald Fadinger; Gino Gancia
    Abstract: We use French data over the 1994-2013 period to study how imports of industrial robots affect firm-level outcomes. Compared to other firms operating in the same 5-digit sector, robot importers are larger, more productive, and employ a higher share of managers and engineers. Over time, robot import occurs after periods of expansion in firm size, and is followed by improvements in efficiency and a fall in demand for labor. Guided by a simple model, we develop various empirical strategies to identify the causal effects of robot adoption. Our results suggest that, while demand shocks generate a positive correlation between robot imports and employment, exogenous changes in automation lead to job losses. We also find that robot imports increase productivity and the employment share of high-skill professions, but have a weak effect on total sales. The latter result suggests that productivity gains from automation may not be entirely passed on to consumers in the form of lower prices.
    Keywords: automation, displacement, firms, robots
    JEL: J23 J24 O33 D22
    Date: 2020
  8. By: P. G. J. Persoon; R. N. A. Bekkers; F. Alkemade
    Abstract: Technological cumulativeness is considered one of the main mechanisms for technological progress, yet its exact meaning and dynamics often remain unclear. To develop a better understanding of this mechanism we approach a technology as a body of knowledge consisting of interlinked inventions. Technological cumulativeness can then be understood as the extent to which inventions build on other inventions within that same body of knowledge. The cumulativeness of a technology is therefore characterized by the structure of its knowledge base, which is different from, but closely related to, the size of its knowledge base. We analytically derive equations describing the relation between the cumulativeness and the size of the knowledge base. In addition, we empirically test our ideas for a number of selected technologies, using patent data. Our results suggest that cumulativeness increases proportionally with the size of the knowledge base, at a rate which varies considerably across technologies. At the same time we find that across technologies, this rate is inversely related to the rate of invention over time. This suggests that the cumulativeness increases relatively slow in rapidly growing technologies. In sum, the presented approach allows for an in-depth, systematic analysis of cumulativeness variations across technologies and the knowledge dynamics underlying technology development.
    Date: 2020–11
  9. By: Jacopo Staccioli; Maria Enrica Virgillito
    Abstract: The present chapter provides a historical reappraisal of labor-saving technologies. It reviews and systematizes theoretical contributions and empirical findings documenting the presence of labor- and time-saving heuristics in innovative efforts back since the First Industrial Revolution. More in detail, with the help of various patent analyses, the chapter documents the presence of labor-saving heuristics in the latest wave of technological innovation, detecting the human functions substituted by the underlying technologies. Against a reductionist approach conceiving robots as the only threat for labor displacement, it shall be argued that labor-saving technologies consist of a complex and heterogeneous bundle of innovations uncovering a much wider set of artifacts and functions. Motivated by the recurrent debate on the threats of automation occurring in the last couple of centuries, evidence is provided on the existence of long waves and clusters in relevant innovations, discussing how the overall cluster of labor-saving technologies consists of heterogeneous and often independent innovations following remarkably different time-trajectories. The chapter closes with an outline of potential future trends in labor-saving technologies and room for policy actions.
    Keywords: Human-Machine Relationship; History of Technology; Labor-Saving Heuristics.
    Date: 2020–12–14
  10. By: U.J. Wagner; D. Kassem; A. Gerster; J. Jaraite-Kazukauske; M. Klemetsen; M. Laukkanen; J. Leisner; R. Martin; J.R. Munch; M. Muûls; A.T. Nielsen; L. de Preux; K.E. Rosendahl; S. Schusser
    Abstract: This paper presents first results from a new European-wide research network for evidence-based climate policy. Using administrative data on industrial firms in Denmark, Finland, France, Germany, Lithuania, Norway, and Sweden, we construct harmonized measures of carbon dioxide emissions per job. We characterize the distribution of this measure and explore how it varies across countries, two-digit industries, and over time. We relate those changes to participation in the EU Emissions Trading System - Europe's flagship climate policy instrument since 2005.
    Keywords: carbon dioxide emissions, manufacturing, climate policy, employment
    JEL: Q54 H23
    Date: 2020–12
  11. By: F. Landini; C. Franco
    Abstract: The interplay between organization practices and innovation is highly relevant in modern business. This paper analyzes whether a specific organizational dimension, namely workforce agility, affects innovative performance. We rationalize this effect within an organizational economics perspective that stresses the role of behavioral motives and skill variety in the innovation process. In particular, we distinguish the contribution of two components: time agility and task agility. Using a sample of nearly 20000 private-sector workplaces in 32 countries, we report conditional correlations between workforce agility and innovation that are consistent with our framework. Establishments with higher workforce agility are more likely to innovate. This relationship holds also when we consider different types of innovation and we distinguish between time and task agility. The analysis of managers’ perceptions about internal working climate and information exchange activities suggest that this effect is likely be driven by the fact that workforce agility improves work motivation and knowledge transmission at the workplace level, favouring innovation. Managerial and policy implications are discussed.
    Keywords: workforce agility, task agility, time agility, innovation
    Date: 2020
  12. By: Akio Kawasaki (Faculty of Economics, Oita University); Tomomichi Mizuno (Graduate School of Economics, Kobe University); Kazuhiro Takauchi (Faculty of Business and Commerce,Kansai University)
    Abstract: This study considers the role of the upstream process research and development (R&D) when downstream develops new products. We build a model in which an upstream firm conducts cost-reducing investment and two downstream firms develop new products. We assume that all products are differentiated. We show that downstream product development promotes upstream investment. We also demonstrate that downstream product development is a strategic complement if upstream R&D efficiency is high, while it is a strategic substitute if it is low. This implies that the occurrence of complementary equilibrium does not need asymmetry in the differentiated final-product markets and is in sharp contrast to the previous study.
    Date: 2020–12
  13. By: Jaan Masso; Priit Vahter
    Abstract: Although much research has investigated how innovation affects wages and wage inequality in general, less is still known on how innovation in firms affects the gender wage gap. We show, using matched employer-employee data from Estonia, that technological (product and process) and non-technological (organizational and marketing) innovation, as well as the firm’s own R&D and innovation-related collaboration with external partners are, on average, associated with a larger gender wage gap in the firm. The positive effect of innovation on wages is about 3–5 percentage points smaller for women compared to men. The relationship between innovation and gender wage gap is stronger in the case of managers and plant and machine operators; therefore, both at the higher and lower end of the wage distribution, potentially indicating the importance of routine-biased technological change. We further show based on propensity score matching that men gain more from taking up a job at an innovative firm than women. The effect of innovation on men’s wages and on the gender wage gap is significantly larger among newly hired employees compared to incumbent employees. Among the newly hired employees at innovative firms, taking up a job at a more ‘open’ innovator appears to be associated with especially strong gains for newly hired women. However, even in this case the gains fall short of the gains for men.
    Keywords: innovation, gender wage gap, wage inequality
    Date: 2020
  14. By: Saul Lach; Zvika Neeman; Mark Schankerman
    Abstract: We study how to design an optimal government loan program for risky R&D projects with positive externalities. With adverse selection, the optimal government contract involves a high interest rate but nearly zero co-financing by the entrepreneur. This contrasts sharply with observed loan schemes. With adverse selection and moral hazard (two effort levels), the optimal policy consists of a menu of at most two contracts, one with high interest and zero self-financing, and a second with a lower interest plus co-financing. Calibrated simulations assess welfare gains from the optimal policy, observed loan programs, and a direct subsidy to private venture capital firms. The gains vary with the size of the externalities, cost of public funds, and effectiveness of the private VC industry.
    Keywords: mechanism design, innovation, R&D, entrepreneurship, additionality, government finance, venture capital
    JEL: D61 D82 O32 O38
    Date: 2020–06
  15. By: José-Ignacio Antón; Enrique Fernández-Macías; Rudolf Winter-Ebmer
    Abstract: Whereas there are recent papers on the eect of robot adoption on employ- ment and wages, there is no evidence on how robots aect non-monetary working conditions. We explore the impact of robot adoption on several domains of non-monetary working conditions in Europe over the period 19952005 combining information from the World Robotics Survey and the European Working Conditions Survey. Aiming to deal with the possible en- dogeneity of robot deployment, we employ an instrumental variables strategy, using the robot exposure by sector in other developed countries as an instru- ment. Our results indicate that robotization has a negative impact on the quality of work in the dimension of work intensity and no relevant impact on the domains of physical environment or skills and discretion.
    Keywords: robotization, working conditions, job quality, Europe, regional labour markets
    JEL: J24 J81 O33
    Date: 2020–12

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