|
on Innovation |
| By: | Toole, Andrew A. |
| Abstract: | While most economists believe that public scientific research fuels industry innovation and economic growth, systematic evidence supporting this relationship is surprisingly limited. In a recent study, Acemoglu and Linn (2004) identified market size as a significant driver of drug innovation in the pharmaceutical industry, but they did not find any evidence supporting science-driven innovation from publicly funded research. This paper uses new data on biomedical research investments by the U.S. National Institutes of Health (NIH) to examine the contribution of public research to pharmaceutical innovation. The empirical analysis finds that both market size and NIH funded basic research have economically and statistically significant effects on the entry of new drugs with the contribution of public basic research coming in the earliest stage of pharmaceutical drug discovery. The analysis also finds a positive return to public investment in basic biomedical research. -- |
| Keywords: | R&D,NIH,social return,biomedical,research lags,public science,new molecular entities |
| JEL: | O31 O32 L65 H51 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:11063&r=ino |
| By: | Agustí Segarra (Research Group of Industry and Territory, Department of Economics, Universitat Rovira i Virgili.) |
| Abstract: | This paper explores the factors that determine firm’s R&D cooperation with different partners, paying special attention on the role of tertiary education (degree and PhDs level) in facilitating the connection between the firms and the to scientific bodies (technology centres, public research centres and universities). Here, we attempt to answer two questions. First, are innovative firms that carry out internal and external R&D activities more likely to cooperate on R&D projects with other partners? Second, do Spanish innovative firms with a high participation of researchers with degrees or PhDs tend to cooperate more with scientific partners? To answer both questions we apply a three-dimensional approach on a firm level Panel Data with a sample of 4.998 manufacturing and services Spanish firms. First, we run a complementary test between external R&D acquisition and skilled research workers and find that firms which carry out external R&D activities obtain a greater return on R&D cooperation when they have skilled workers in R&D, especially in high-tech manufactures and KIS services. Second, we carry out a 2-step tobit model to estimate, in the first stage, the determinants that explain whether Spanish innovative firms cooperate or not; and in the second stage the factors that affect the choice of partners. And third, we apply an ordered probit model to test the marginal effects of explanatory variables on the different partners. Here we contrast some of the most interesting empirical hypotheses of previous studies, and which emphasize the role of employees with degrees and PhDs in facilitating cooperative R&D between firms and scientific partners. |
| Keywords: | Determinants R&D cooperation, industry-university flows, PhD research workers |
| JEL: | O31 O33 O38 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:xrp:wpaper:xreap2011-17&r=ino |
| By: | Elvira Uyarra |
| Abstract: | Despite the popularity of the concept 'regional innovation system' (RIS) in the academic literature and in policy practice, multiple interpretations and uses of the term coexist. For instance while some scholars view RIS as subsystems of national or sector-based systems presenting particular spatial features, other portray them as smaller-scale versions of national systems (Lagendijk, 1999; Howells, 1999; Iammarino, 2005, Uyarra, 2010). Doloreux & Parto (2005) identify three dimensions of regional innovation systems, namely: the interactions between different actors in the innovation process, the role of institutions, and the use of regional innovation systems analysis to inform policy decisions. More generally, Werker & Athreye (2004) differentiate between micro and meso approaches explaining regional innovation; while the former concentrate on the entrepreneurial behaviour of innovative firms, the latter focus on the structural elements manifested in the institutional set-up of regional and industrial systems. Boschma & Frenken (2006) distinguish between institutional and evolutionary views to innovation and geography as alternatives to neoclassical views. Related literature on national innovation systems (NIS) is no less heterogeneous, with numerous usages and interpretations (Miettinen, 2002; Balzat & Hanusch, 2004; Sharif, 2006; Lundvall, 2007). Despite the popularity of the concept ‘innovation system’ in the academic literature and in policy practice, the term itself remains ambiguous (Doloreux & Parto 2005; Uyarra, 2010). This fuzziness (Markusen, 2003), even ‘black boxing’ of the term, may have obscured certain aspects influencing regional development while overstating others (Uyarra & Flanagan, 2010). |
| Keywords: | Regional systems of innovation, institutions,innovation policy |
| JEL: | B52 R1 O31 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwpol:1113&r=ino |
| By: | Andrey Martovoy; Dimitri Gagliardi |
| Abstract: | NIS is nowadays one of the most widespread tools of the analysis of factors influencing the creation, diffusion and adoption of innovations. Innovation is often more seen as the main driver for growth within economic and social systems. During the Soviet era, the national innovation system of Ukraine was somehow integrated within the Soviet Union’s system of innovation, though each republic had their production, research and development specialisation. Over last decades science and technology sectors of Ukraine underwent considerable changes in the bid to reallocate its scientific resources away from military towards civilian goals and to develop its internal capacity to foster innovations. Nonetheless the Ukrainian system of Innovation has performed very poorly. Ukrainian NIS failure reflects in the poor innovation performance of national firms. In the past two decades it became apparent that macroeconomic conditions and taxation are among the most important framework conditions which affected negatively the innovation performance of Ukraine. |
| Keywords: | innovation policy, macroeconomic analysis of economic development, government policy |
| JEL: | O11 O38 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwpol:1111&r=ino |
| By: | Toole, Andrew A.; King, John L. |
| Abstract: | Prior research shows long-run productivity growth in agriculture is associated with increases in the stock of public scientific knowledge and private patented inventions. However, private inventions may be a function of the stock of public knowledge. In this paper, we examine the possibility that public knowledge contributes to productivity through its relationship with private sector invention. Our analysis identifies connections between the stock of public knowledge and private firm R&D and examines whether the degree of 'connectedness' to public science is associated with greater firm-level research productivity in agriculture. Bibliographic information identifies the nature and degree to which firms use public agricultural science through citations and collaborations on scientific papers. Fixed effects models show that greater citations and collaborations with university researchers are associated with greater private agricultural research productivity. -- |
| Keywords: | Public science,research productivity,patents,citations,collaboration,R&D,bibliometrics |
| JEL: | Q16 O31 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:11064&r=ino |
| By: | Riccardo Crescenzi; Luisa Gagliardi; Marco Percoco |
| Abstract: | Social capital has remained relatively underexplored in innovation literature. Existing studies have failed to reach a consensus on its impact on local innovative performance: some empirical analyses emphasize a positive effect, others speak about a 'dark side' of social capital. This paper aims to fill this gap by shedding new light on the differential role of 'bonding' and 'bridging' social capital. The quantitative analysis of the innovative performance of the Italian provinces shows that social capital is an important predictor of innovative performance after controlling for 'traditional' knowledge inputs (R&D investments and human capital endowment) and other characteristics of the local economy. However, only 'bridging' social capital - based on weak ties - can be identified as the key driver of the process of innovation while 'bonding' social capital is shown to be negative for innovation. Instrumental variable analysis makes it possible to identify clear causal links between bridging (positive) and bonding (negative) social capital and innovation. |
| Keywords: | Innovation, social capital, knowledge transfer, regional development |
| JEL: | O31 O33 R15 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0096&r=ino |
| By: | Allain, Marie-Laure; Chambolle, Claire; Rey, Patrick |
| JEL: | L13 L41 |
| Date: | 2011–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:24587&r=ino |
| By: | Dubois, Pierre; de Mouzon, Olivier; Scott Morton, Fiona; Seabright, Paul |
| Abstract: | This paper quanti es the relationship between market size and innovation in the pharmaceutical industry. We estimate the elasticity of innovation, as measured by the number of new chemical entities appearing on the market for a given disease class, to the potential market size represented by the willingness of su¤erers of diseases in that class (and others acting on their behalf such as insurers and governments) to spend on their treatment during the patent lifetime. We nd positive signi cant elasticities with a point estimate under our preferred speci cation of 25.2%. This suggests that at the mean market size an additional $1.8 billion is required in additional patent life revenue to induce the invention of one additional new chemical entity. An elasticity substantially and signi cantly below one-half is also a plausible implication of the hypothesis that innovation in pharmaceuticals is becoming more di¢ cult and expensive over time, as costs of regulatory approval rise and as the industry runs out of "low hanging fruit". |
| Keywords: | Innovation, Market Size, Elasticity, Pharmaceuticals |
| JEL: | O31 L65 O34 |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:24352&r=ino |
| By: | Dubois, Pierre; de Mouzon, Olivier; Scott Morton, Fiona; Seabright, Paul |
| Abstract: | This paper quanti es the relationship between market size and innovation in the pharmaceutical industry. We estimate the elasticity of innovation, as measured by the number of new chemical entities appearing on the market for a given disease class, to the potential market size represented by the willingness of su¤erers of diseases in that class (and others acting on their behalf such as insurers and governments) to spend on their treatment during the patent lifetime. We nd positive signi cant elasticities with a point estimate under our preferred speci cation of 25.2%. This suggests that at the mean market size an additional $1.8 billion is required in additional patent life revenue to induce the invention of one additional new chemical entity. An elasticity substantially and signi cantly below one-half is also a plausible implication of the hypothesis that innovation in pharmaceuticals is becoming more di¢ cult and expensive over time, as costs of regulatory approval rise and as the industry runs out of "low hanging fruit". |
| Keywords: | Innovation, Market Size, Elasticity, Pharmaceuticals |
| JEL: | O31 L65 O34 |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:24353&r=ino |
| By: | Meyborg, Mirja |
| Abstract: | In recent years, it has widely been accepted that the ability to create, access and use knowledge and technology is becoming a fundamental determinant of long-term development and competitiveness. Thus, it is not surprising that universities have increasingly become involved in economic development and are often believed to play a key role in regional economic development. This paper firstly examines how far all West-German universities are already involved in close network collaborations. Second, it demonstrates how many distinct linkages 45 chosen West-German universities already possess within the innovation network, and third, to what extent they are already needed as a link in the chains of contacts. Thereby, special attention is given to the eight West-German elite-universities. We basically found out that university interactions, especially university-enterprise networks, become much more important over the last 20 years, as their cooperation activity strongly increased over time. Besides, their distinct linkages to other actors as well as their importance as an intermediary within the innovation network highly increased over the last decade, too; this especially holds for the eight West-German elite universities. -- |
| Keywords: | Human Capital,Economic Growth,Social Network Analysis,Patent Analysis,Patent Collaboration,Network Interaction,West-German University,Elite-University |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:kitwps:35&r=ino |
| By: | Bernhard Ganglmair (Jindal School of Management, University of Texas at Dallas); Emanuele Tarantino (Department of Economics, University of Bologna) |
| Abstract: | We present a model of industry standard setting with two-sided asymmetric information about the existence of intellectual property. We provide an equilibrium analysis of (a) firms' incentives to communicate ideas for improvements of an industry standard, and (b) firms' decisions to disclose the existence of intellectual property to other participants of the standardization process. |
| Keywords: | patent holdup; patent disclosure; standard setting organizations; industry standards; disclosure rules; conversation; asymmetric information; Bertrand competition. |
| JEL: | D71 L15 O34 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:net:wpaper:1115&r=ino |
| By: | Paula Faria (Faculdade de Economia, Universidade do Porto); Francisco Vitorino da Silva Martins (Faculdade de Economia, Universidade do Porto); Elísio Fernando Moreira Brandão (Faculdade de Economia, Universidade do Porto) |
| Abstract: | Setting targets to increase the levels of R&D, a component that is present in the political and economic agendas of the European Member States with the promotion of active tax policies, suggests that it is possible for R&D to cause an impact on economic growth. This research work aims at understanding the influence of the evolution of R&D expenditures, as well as the influence of tax incentives on economic growth. For that, a panel data of 15 European countries, during the period between 1995 and 2008, was used. The econometric study confirms the foreseen importance, both in this study and in the literature, of the countries’ R&D efforts and their impact on economic growth. The positive effect of tax incentives on economic growth, combined with R&D levels, is highlighted and demonstrated, thus confirming a strategic orientation towards tax policies followed by the national institutions. |
| Keywords: | R&D, tax incentives, economic growth, econometric analysis in panel data |
| JEL: | C23 H20 H3 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:442&r=ino |
| By: | Massimiliano Mazzanti; Valeria Costantini; Susanna Mancinelli; Massimilano Corradini |
| Abstract: | We model investment decisions regarding innovation and emissions abatement in a dynamic theoretical framework. Considering knowledge stock as an impure public good, we study the reaction function between one representative agent’s investments in innovation and the other agents’ investments in the public characteristic of the impure public good. We demonstrate that the reaction function has a positive slope under general conditions and that its sensitiveness is affected by assumptions on the elasticity of substitution in the benefit function. The positivity of the reaction function is then empirically tested in an econometric estimation. We exploit an original sector-based database by gathering innovation efforts as well as polluting emissions and economic dimensions over the time span 1996-2005 for 15 European countries and 23 manufacturing sectors. Empirical results show that sector-based innovation investment is positively driven by the public characteristics provided by other sectors. Different reactivity strength for different polluting emissions also allows us to disclose the role of complementarity in agents’ decisions. |
| Keywords: | impure public goods; environmental externalities; innovation spillovers |
| JEL: | D21 H41 O33 Q53 Q55 |
| Date: | 2011–11–19 |
| URL: | http://d.repec.org/n?u=RePEc:udf:wpaper:201117&r=ino |
| By: | Acemoglu, Daron; Aghion, Philippe; Bursztyn, Leonardo; Hemous, David |
| Abstract: | This paper introduces endogenous and directed technical change in a growth model with environmental constraints. A unique final good is produced by combining inputs from two sectors. One of these sectors uses "dirty" machines and thus creates environmental degradation. Research can be directed to improving the technology of machines in either sector. We characterize dynamic tax policies that achieve sustainable growth or maximize intertemporal welfare. We show that: (i) in the case where the inputs are sufficiently substitutable, sustainable long-run growth can be achieved with temporary taxation of dirty innovation and production; (ii) optimal policy involves both .carbon taxes. and research subsidies, so that excessive use of carbon taxes is avoided; (iii) delay in intervention is costly: the sooner and the stronger is the policy response, the shorter is the slow growth transition phase; (iv) the use of an exhaustible resource in dirty input production helps the switch to clean innovation under laissez-faire when the two inputs are substitutes. Under reasonable parameter values and with sufficient substitutability between inputs, it is optimal to redirect technical change towards clean technologies immediately and optimal environmental regulation need not reduce long-run growth. |
| Keywords: | directed technological change; environment; exhaustible resources; innovation |
| JEL: | C65 O30 O31 O33 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8660&r=ino |
| By: | Ufuk Akcigit; Qingmin Liu |
| Abstract: | Technological progress is typically a result of trial-and-error research by competing firms. While some research paths lead to the innovation sought, others result in dead ends. Because firms benefit from their competitors working in the wrong direction, they do not reveal their dead-end findings. Time and resources are wasted on projects that other firms have already found to be dead ends. Consequently, technological progress is slowed down, and the society benefits from innovations with delay, if ever. To study this prevalent problem, we build a tractable two-arm bandit model with two competing firms. The risky arm could potentially lead to a dead end and the safe arm introduces further competition to make firms keep their dead-end findings private. We characterize the equilibrium in this decentralized environment and show that the equilibrium necessarily entails significant efficiency losses due to wasteful dead-end replication and a flight to safety – an early abandonment of the risky project. Finally, we design a dynamic mechanism where firms are incentivized to disclose their actions and share their private information in a timely manner. This mechanism restores efficiency and suggests a direction for welfare improvement. |
| JEL: | D83 D92 O31 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17602&r=ino |
| By: | Dessi, Roberta (IDEI, Toulouse School of Economics) |
| Abstract: | Innovative start-ups and venture capitalists are highly clustered, benefiting from localized spillovers: Silicon Valley is perhaps the best example. There is also substantial geographical variation in venture capital contracts: California contracts are more "incomplete". This paper proposes an economic explanation for these observations, often attributed to regional cultural differences. In the presence of significant spillovers, it becomes optimal for an innovative start-up and its financier to adopt contracts with fewer contingencies: these contracts maximize their ability to extract (part of) the surplus they generate through positive spillovers. This relaxes ex-ante financing constraints and makes it possible to induce higher innovative effort. |
| JEL: | D82 D86 G24 L22 |
| Date: | 2011–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:24944&r=ino |
| By: | Gert-Jan Linders; Tatyana Bulavskaya; Henri De Groot; Ferdinand Paraguas |
| Abstract: | Discussion on the possibilities for and barriers to income convergence and catch-up growth is at the heart of the debate on European regional economic policy. This study presents an empirical analysis of the determinants of regional productivity growth in Europe, using the most recent Cambridge Econometrics regional database, EU KLEMS growth and productivity accounts and EuroStat R&D data. We apply a reduced-form empirical specification for semi-endogenous productivity growth that allows for differences in steady state income levels and long-run growth rates. Productivity growth in a region depends on its level of human capital, the investments in R&D, and the productivity gap with the technology frontier. Empirical findings show that these factors are interrelated. Apart from a technology gap, absorptive capacity is important to realize catch-up. Both convergence and divergence of productivity across regions are possible. Results show that all considered factors have significant effect on disparity in regional productivity growth, although effects across manufacturing and service sectors are different. The estimated model also features stable dynamic properties in response to an exogenous shock. Keywords: Semi-endogenous Growth, Regional Convergence, International Transfer of Technology, human capital, R&D. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa11p64&r=ino |
| By: | Schilirò, Daniele |
| Abstract: | The aim of the contribution is to focus on the innovation of Italian medium and medium -large multinationals who represent the "fourth capitalism” and also to evaluate their performance. The enterprises of “fourth capitalism " are the set of medium and medium-large enterprises who seem to be stronger on foreign markets, either through exports or through foreign direct investment. The paper uses the data set from Mediobanca Research Unit to provide a descriptive analysis of the performance of Italian multinational enterprises of the "fourth capitalism", showing the complex approach to the internationalization of these enteprises, where innovation plays a key role. Flexibility and specialization in the production are also important elements that drive the decision to invest and produce abroad for these enterprises. The commercial dimension also plays a key role for the firms of the "fourth capitalism", as it leads to the direct control of foreign markets. The study points out that one of the strategic objectives of Italian multinationals of the “fourth capitalism” is their strong customer focus and organizational effort to provide their services to the customers, which require substantial investment in immaterial assets. Finally, the work highlights some external constraints that penalize the Italian multinational enterprises of the “fourth capitalism”, as the high cost of bureaucracy, excessive and unfair taxation, lack of support to internationalization by public institutions. |
| Keywords: | Italian multinational firms; fourth capitalism; innovation; internazionalization; |
| JEL: | L25 O30 F23 L10 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:34916&r=ino |
| By: | Luisa Gagliardi |
| Abstract: | What is the effect of an increase in the stock of human capital on the innovative performance of a local economy? This paper tests the hypothesis of a causal link between an increase in the average stock of human capital, due to skilled migration inflows, and the innovative performance of local areas using British data. The paper examines the role of human capital externalities as crucial determinant of local productivity and innovative performance, suggesting that the geographically bound nature of these valuable knowledge externalities can be challenged by the mobility of skilled individuals. Skilled migration becomes a crucial channel of knowledge diffusion broadening the geographical scope of human capital externalities and fostering local innovative performance. |
| Keywords: | Innovation, migration, education, externalities |
| JEL: | O15 O31 I2 H22 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0097&r=ino |