nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2022‒11‒07
nine papers chosen by
Fulvio Castellacci
Universitetet i Oslo

  1. Structural change within versus across firms: evidence from the United States By Xiang Ding; Teresa C. Fort; Stephen J. Redding; Peter K. Schott
  2. Technology adoption, innovation policy and catching-up By Perilla Jiménez, Juan R.; Ziesemer, Thomas
  3. Foreign ownership and robot adoption By Fabrizio Leone
  4. The rise of China's technological power: the perspective from frontier technologies By Antonin Bergeaud; Cyril Verluise
  5. Climate Change, Gender Equality, and Firm-Level Innovation : Cross-Country Evidence By Abdulla, Eman; Lim, King Yoong; Morris, Diego; Saliba, Faten
  6. Where the EU stands vis-à-vis the USA and China? Corporate R&D intensity gap and structural change By MONCADA PATERNO' CASTELLO Pietro; GRASSANO Nicola
  7. Knowledge spillovers from clean and emerging technologies in the UK By Ralf Martin; Dennis Verhoeven
  8. The Returns to Innovation in East Asia : The Role of the Business Environment and Firms' Characteristics By De Nicola,Francesca; Chen,Pinyi
  9. Measuring the Characteristics and Employment Dynamics of U.S. Inventors By Ufuk Akcigit; Nathan Goldschlag

  1. By: Xiang Ding; Teresa C. Fort; Stephen J. Redding; Peter K. Schott
    Abstract: We document the role of intangible capital in manufacturing firms' substantial contribution to non-manufacturing employment growth from 1977-2019. Exploiting data on firms' "auxiliary" establishments, we develop a novel measure of proprietary in-house knowledge and show that it is associated with increased growth and industry switching. We rationalize this reallocation in a model where firms combine physical and knowledge inputs as complements, and where producing the latter in-house confers a sector-neutral productivity advantage facilitating within-firm structural transformation. Consistent with the model, manufacturing firms with auxiliary employment pivot towards services in response to a plausibly exogenous decline in their physical input prices.
    Keywords: structural transformation, professional services, intangible knowledge, economic growth
    Date: 2022–06–01
  2. By: Perilla Jiménez, Juan R.; Ziesemer, Thomas (Macro, International & Labour Economics, Mt Economic Research Inst on Innov/Techn, RS: GSBE MORSE)
    Abstract: A model is proposed where economic growth is driven by innovation along the diffusion and adoption of technology from the frontier. Business innovation investments are related to households savings, which generates equilibria with low levels of, and equilibria with high levels of, innovation. Low-level equilibria are unstable. Starting from a position with low levels of investment and innovation, increasing investments are associated with high but decreasing dependence on international technology diffusion. A major objective of policy-making is to increase investment sufficiently in the lower end to reach the high level steady state. An economic rationale is provided for the existence of productivity improving equilibria, where distance to frontier countries is reduced owing to a tax and subsidy mechanism designed to boost innovation.
    JEL: C62 O33 O38 O40
    Date: 2022–07–21
  3. By: Fabrizio Leone
    Abstract: This paper shows that multinational enterprises (MNEs) spur the adoption of industrial robots. First, I document a positive and robust correlation between multinational production and robot adoption using a new cross-country industry-level panel. Second, using detailed data about Spanish manufacturing, I combine a difference-in-differences approach with a propensity score reweighing estimator and provide evidence that firms switching from domestic to foreign ownership become about 10% more likely to employ robots. The ability of expanding into foreign markets via the parental network is the key driver of the adoption choice. An empirical model of firm investment reveals that MNEs generate significant industry-level productivity gains but decreases the labor share by boosting robot adoption. However, the first effect is one order of magnitude larger than the second. These results provide new evidence about the efficiency versus equity trade-off that policymakers face when attracting MNEs.
    Keywords: foreign ownership, industrial robots, total factor productivity, factor-biased productivity, labor share
    Date: 2022–06–08
  4. By: Antonin Bergeaud; Cyril Verluise
    Abstract: We use patent data to study the contribution of the US, Europe, China and Japan to frontier technology using automated patent landscaping. We find that China's contribution to frontier technology has become quantitatively similar to the US in the late 2010s while overcoming the European and Japanese contributions respectively. Although China still exhibits the stigmas of a catching up economy, these stigmas are on the downside. The quality of frontier technology patents published at the Chinese Patent Office has leveled up to the quality of patents published at the European and Japanese patent offices. At the same time, frontier technology patenting at the Chinese Patent Office seems to have been increasingly supported by domestic patentees, suggesting the build up of domestic capabilities.
    Keywords: frontier technologies, China, patent landscaping, machine learning, patents
    Date: 2022–10–14
  5. By: Abdulla, Eman (Department of Economics, University of Warwick); Lim, King Yoong (International Business School Suzhou, Xian Jiaotong-Liverpool University); Morris, Diego (Nottingham Business School, Nottingham Trent University); Saliba, Faten (International Monetary Fund)
    Abstract: This paper examines the nexus between gender equality, climate change, and innovation at the firm level. Based on three hypotheses derived from a novel theoretical framework linking climate change and gender equality to within-firm innovation activities, we use a cross-section dataset of 87, 996 firms across 36 industries in 103 countries, surveyed across different waves during the 2010-2020 periods to implement an instrumental variable strategy and show that environmental policies unambiguously induce firm-level process and product innovation, through its influence on the endogenous bargaining power of women in society and firms. We document that female productivity has both a direct effect on innovation (0.1-1.3% increase in the likelihood of innovation) and an indirect effect (serving as the intermediation for the environment-innovation nexus). Contrarily, greenhouse gas emissions by themselves have an ambiguous effect on innovation. The type of greenhouse gas emissions and the measure of innovation both contribute to this ambiguity. Overall, our results show that it is not the physics of climate change that induces innovation but rather the countervailing human responses to policies that mitigate climate change that stimulate innovation.
    Keywords: Climate change ; firm-level analysis ; gender equality ; innovation. JEL Codes: D24 ; J16 ; L25 ; O32 ; Q58
    Date: 2022
  6. By: MONCADA PATERNO' CASTELLO Pietro (European Commission - JRC); GRASSANO Nicola (European Commission - JRC)
    Abstract: This Brief explores the longstanding deficit in the EU’s overall corporate R&D intensity compared with that of competing economies over the last decade. The main results indicate the following: The EU business sector is still leading in traditional medium-tech sectors, such as automobiles and parts. As for the US and China, they are much stronger in newer high-tech sectors, and have maintained and even increased their strength in the last decade. For the EU, this causes a lower overall share of net sales and of R&D investment in sectors of high R&D intensity, compared with the full sample (all sectors). Consequently, there is a lower impact on the aggregate (all sectors) result for EU R&D intensity. The EU has a small number of global players in key sectors of high R&D intensity, such as biotechnology and ICT. The sample of top EU R&D investing companies is ahead in the production of green patents related to climate change technologies, as compared with the US and China. Tailored policies should also foster the speed of structural (sectoral) change towards sectors that are more R&D intensive, including some emerging ones, for example artificial intelligence and renewable energies. This will help the creation and growth of more firms in such sectors.
    Keywords: EU vs China vs USA, Corporate R&D intensity gap, structural change
    Date: 2022–09
  7. By: Ralf Martin; Dennis Verhoeven
    Abstract: The UK government has committed to increase R&D support for clean technologies in an effort to meet its net-zero target by 2050. The opportunity cost of such programs crucially depends on the value of knowledge spillovers that accrue from clean relative to other (emerging) technologies. Using patent information to measure the value of direct and indirect knowledge spillovers, we derive estimates for the expected economic returns of subsidising a particular technology field. Our method allows comparing fields by the returns a hypothetical additional subsidy would have generated within the UK or globally. Clean technologies are top-ranked in terms of within-UK returns, with Tidal and Offshore Wind showing particularly high returns. In terms of global returns, emerging technologies such as Wireless, as well as Electrical Engineering outperform Clean by a small margin. We also find that cross-border knowledge spillovers are important for all technology fields, with global return rates over ten times larger than within-UK ones. In sum, our results suggest that the opportunity cost of R&D support programs for clean innovation in the UK is low at worst.
    Keywords: innovation, knowledge spillovers, clean technology, innovation policy, patent data
    Date: 2022–03–02
  8. By: De Nicola,Francesca; Chen,Pinyi
    Abstract: The paper studies the relationship between innovation efforts, innovation outputs, andproductivity, using firm-level data from six East Asian countries. Firms are more likely to invest in innovationwhen they use technology licensed by a foreign company, are part of a large group, and have a more educated workforce.Investment in research and development can significantly boost both product and process innovation. Product innovation yields significant productivity gains. However,productivity gains from process innovation are not detectable in the sample.
    Keywords: Innovation,Educational Sciences,Labor Markets,Construction Industry,Plastics & Rubber Industry,General Manufacturing,Common Carriers Industry,Pulp & Paper Industry,Business Cycles and Stabilization Policies,Food & Beverage Industry,Textiles, Apparel & Leather Industry,Business Environment
    Date: 2022–02–01
  9. By: Ufuk Akcigit; Nathan Goldschlag
    Abstract: Innovation is a key driver of long run economic growth. Studying innovation requires a clear view of the characteristics and behavior of the individuals that create new ideas. A general lack of rich, large-scale data has constrained such analyses. We address this by introducing a new dataset linking patent inventors to survey, census, and administrative microdata at the U.S. Census Bureau. We use this data to provide a first look at the demographic characteristics, employer characteristics, earnings, and employment dynamics of inventors. These linkages, which will be available to researchers with approved access, dramatically increases the scope of what can be learned about inventors and innovative activity.
    Date: 2022–09

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