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on Innovation |
| By: | Saul Lach; Mark Schankerman |
| Abstract: | We show that economic incentives affect the commercial value of inventions generated in universities. Using data for 102 U.S. universities during the period 1991-1999, we find that universities which give higher royalty shares to academic scientists generate higher license income, controlling for other factors including university size, quality, research funding and technology licensing inputs. We provide evidence that this is due to the fact that public universities are less effective at commercialising inventions, which weakens the incentive effect of higher royalty shares. Other findings include: 1) there is a Laffer effect in private universities: raising the inventor's royalty share increases the license income retained by the university; 2) the incentive effect works primarily by increasing the quality of inventions, and 3) the incentive effect appears to operate both by raising faculty effort and by sorting academic scientists across universities. |
| Keywords: | Academic research, incentives, licensing, royalties, technology transfer, intellectual property. |
| Date: | 2004–03 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stieip:33&r=ino |
| By: | Maria Luisa Mancusi |
| Abstract: | This paper provides an empirical assessment of the effect of national and international knowledge spillovers on innovation at a finely defined sectoral level for six major industrialised countries over the period 1981-1995. International spillovers are always found to be effective in increasing innovative productivity. The paper then uses self-citations to investigate the role of prior R&D experience in enhancing a country¿s ability to understand and improve upon external knowledge (absorptive capacity). The empirical results show that absorptive capacity increases the elasticity of a country¿s innovation to both national and international spillovers. The larger the gap of a country with the technological leaders, the weaker is this effect, but the larger is the country¿s potential to increase it. |
| Keywords: | R&D spillovers, absorptive capacity and patent citations. |
| Date: | 2004–03 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stieip:35&r=ino |
| By: | Sudipto Bhattacharya; Sergei Guriev |
| Abstract: | We develop a model of two-stage cumulative research and development (R&D), in which one Research Unit (RU) with an innovative idea bargains to license her nonverifiable interim knowledge exclusively to one of two competing Development Units (DUs) via one of two alternative modes: an Open sale after patenting this interim knowledge, or a Closed sale in which precluding further disclosure to a competing DU requires the RU to hold a stake in the licensed DU's post-invention revenues. Both models lead to partial leakage of RU's knowledge from it's description, to the licensed DU alone in a closed sale, and to both DUs in an open sale. We find that higher levels of interim knowledge are more likely to be licensed via closed sales. If the extent of leakage is lower, more RUs choose open sales, generating a non-monotonic relationship between the strength of Intellectual Property Rights (IPR) and aggregate R&D expenditures. We also develop a rationale for the ex ante acquisition of control rights over the RU by a DU, rooted in the RU's incentives to create knowledge under alternative modes of sale thereof, and her wealth constraint in ex interim bargaining. |
| Keywords: | R&D organisation, patents, intellectual property rights |
| JEL: | D23 O32 O34 |
| Date: | 2004–09 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stitep:/2004/478&r=ino |
| By: | José Miguel Benavente H. |
| Abstract: | The aim of this paper is to characterize the current Chilean scientific and technological status from an economic point of view. Given its present level of economic development, major weaknesses are observed in the National System of Innovation. Among them, scarce resources devoted to R&D expressed as a proportion of GDP, low participation of professionals and scientific workforce in research activities and negligible private involvement in financing these activities. We discuss the fundamental role of the public sector in the active promotion of these activities, especially at universities and private firms. In particular, we explore different economic policies aimed at enhancing the participation of the private sector in R&D activities. Revising the Chilean situation, we suggest that although many current programs aimed at supporting research activities are solving most of the typical market failures associated with R&D and innovation, we diagnose that there is a lack of coordination between allexisting initiatives. There is a systemic failure. Based on international experience, we suggest that by designing an explicit technology policy at the national level this failure could be solved. A technology board that gives directions, priorities, rules and performs periodic evaluations, may increase the economic efficiency of public resources devoted to these fundamental activities. |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:chb:bcchwp:295&r=ino |
| By: | Andrea Morrison (University of Piemonte Orientale, Novara, Italy,) |
| Abstract: | A great amount of recent studies dealing with industrial clustering suggests that the innovative performance of industrial districts is strictly linked with their ability to absorb external knowledge. This paper aims at identifying and analysing the main actors involved in this process. We investigate to what extent leading firms located within a successful Italian furniture district behave as gatekeepers of knowledge. Empirical analysis has been carried out on a sample of technicians working within firms’ knowledge intensive units. Adopting social network techniques we are able to trace linkages between technicians and external sources of knowledge and to evaluate their relevance for innovative activities. Our findings suggest that leading firms absorb external knowledge and spread it only to their own network of clients and providers. According to our theoretical framework we argue that leading firms cannot be interpreted as knowledge gatekeepers. |
| Keywords: | Knowledge flows; Industrial districts; Leader firms; Social networks. |
| JEL: | O31 R0 Z13 |
| Date: | 2004–11 |
| URL: | http://d.repec.org/n?u=RePEc:cri:cespri:wp163&r=ino |
| By: | Dittrich, K.; Duysters, G.; De Man, A-P. (Erasmus Research Institute of Management (ERIM), Erasmus University Rotterdam) |
| Abstract: | Large-scale strategic change projects in companies may be supported by using alliance networks. This paper shows that IBM?s change from an exploitation strategy towards an exploration strategy required a radically different network strategy as well. By entering into more non-equity alliances, involving new partners in the network and loosening the ties with existing partners, IBM supported its transformation from a hardware manufacturing company to a global service provider and software company. |
| Keywords: | Networks;innovation;strategic change;exploration/exploitation;IBM; |
| Date: | 2004–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:eureri:30001982&r=ino |
| By: | Charles Wessner |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2004-46&r=ino |
| By: | Keiko Ito |
| Abstract: | Using plant-level data underlying the Census of Manufactures, total factor productivity (TFP) growth and its determinants are analyzed for the Japanese automobile industry since 1980s. The average annual TFP growth rate from 1981 to 1996 was only about 0.6 percent for the automobile assembly industry and about 1.3 percent for the auto parts manufacturing industry. In the Japanese auto parts manufacturing industry, we found that R&D spillovers from assemblers had a significantly positive effect on the parts suppliers' TFP growth and that parts suppliers located near an assembly plant achieved higher TFP growth. |
| Keywords: | Automobile Industry, Total Factor Productivity, Keiretsu, Agglomeration, R&D Spillover |
| JEL: | D24 L22 L23 L62 O32 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:hst:hstdps:d04-51&r=ino |
| By: | Pol, Eduardo (University of Wollongong); Carroll, Peter |
| Abstract: | Schumpeterian growth models revolve around two tacit assumptions that are at odds with the empirical evidence, namely: all innovations are equally important for economic growth (equipollent innovation) and all innovations occur in one sector only (confined innovation). The present paper shows that it is possible to dispose of both implicit assumptions by disaggregating the "ideas production function" without altering the gist of the theoretical framework. The paper refers briefly to the concepts of macro and microinventions, and introduces the concept of "innovatory discontinuity". The extended theoretical framework developed here throws light on the ongoing controversy between neoclassical and evolutionary theorizing. |
| Keywords: | Innovation heterogeneity, ideas production function, scale effects problem, innovatory discontinuity, neoclassical and evolutionary theorizing |
| JEL: | O31 O32 |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:uow:depec1:wp04-21&r=ino |
| By: | Luca Casolaro (Bank of Italy, Economic Research Department); Giorgio Gobbi (Bank of Italy, Economic Research Department) |
| Abstract: | This paper analyzes the effect of information technologies (IT) in the financial sector using micro-data on a panel of over 600 Italian banks over the period 1989-2000. We estimate stochastic cost and profit functions allowing for individual banks’ displacements from the efficient frontier and for non-neutral technological change. Data on IT capital stock for individual banks enable us to distinguish between movements along the efficient frontier and shifts of the frontier owing to the adoption of new technologies. We find that both cost and profit frontier shifts are strongly correlated with IT capital accumulation. Banks adopting IT capital intensive techniques are also more efficient. We interpret this last result as evidence of a catching-up effect consistent with the usual pattern of diffusion of the new technologies. |
| Keywords: | banking, productivity, efficiency, information technology |
| JEL: | D24 G21 O33 |
| Date: | 2004–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_489_04&r=ino |
| By: | Stephen Bond; Dietmar Harhoff; John Van Reenen |
| Abstract: | This paper analyzes di¤erences in R&D spending and in the impact of R&Don productivity between German and UK ¿rms. We con¿rm that German ¿rmsspend signi¿cantly larger amounts on R&D than their UK counterparts, even aftercontrolling for ¿rm size and industry e¤ects. Using a dynamic production functionapproach, we ¿nd that the R&D output elasticity is approximately the same inboth countries, implying a much larger rate of return on R&D in the UK than inGermany. We discuss several explanations for this result. |
| Keywords: | Corporate governance, R&D, productivity, ¿nancial constraints, paneldata |
| JEL: | L13 C25 |
| Date: | 2003–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp0595&r=ino |
| By: | Stephen Bond; Dietmar Harhoff; John Van Reenen |
| Abstract: | This paper analyzes differences in R&D spending and in the impact of R&D on productivity betweenGerman and UK firms. We confirm that German firms spend significantly larger amounts on R&D thantheir UK counterparts, even after controlling for firm size and industry effects. Using a dynamicproduction function approach, we find that the R&D output elasticity is approximately the same in bothcountries, implying a much larger rate of return on R&D in the UK than in Germany. We discuss severalexplanations for this result. |
| Keywords: | Corporate governance, R&D, productivity, financial constraints, panel data |
| JEL: | L13 C25 |
| Date: | 2003–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp0599&r=ino |
| By: | Yochanan Shachmurove (The City College of The City University of New York and the University of Pennsylvania) |
| Abstract: | The incredible profits of Initial Public Offerings have often been emphasized in the media as a popular investment for the public. This paper takes a few steps towards refuting such an assertion by investigating the performance of 2,895 venture capital backed IPOs between 1968 and September 1998. The paper finds that it is incorrect to assume that investors demand very high annualized and cumulative rates of return to compensate for the risks they are taking by financing ventures in different sectors of the economy. The mean rates of return are found to be, in practice, very moderate, and often, negative. |
| Keywords: | Initial public offering; venture capita; annualized and cumulative rates of return; Information Technology; Medical, Health and Life Science; Non-High Technology; Biotechnology; Communications; Computer Industry; Semiconductor and Other Electronics Industries |
| JEL: | C12 D81 D92 E22 G12 G24 G3 M13 M21 O16 O3 |
| Date: | 2004–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:04-030&r=ino |