submarkets and the evolution of market structure we construct a model of industry evolution in which the central force for change is the creation and destruction of submarkets firms expand when they are able to exploit new opportunities that arrive in the form of submarkets they contract and ultimately exit when the submarkets in which they operate are destroyed this simple framework can transparently explain a wide range of well known regularities about industry dynamics most notably the subtle relationships between size age growth and survival data on the laser industry where submarkets are prominent further illustrate the ability of the model to explain distinctive patterns in the evolution of industries and firms

hybrid r d we develop a model of r d collaboration in which individual firms carry out in house research on core activities and undertake bilateral joint projects on non core activities with other firms we develop conditions on the profit functions of the firm under which r d investments in different projects of a firm are complementary we show that this condition is met by standard price and quantity setting oligopoly models we then study the relation between the number of joint projects and investments and profits in this context we identify a second aspect of complementarity equilibrium investments in in house as well as in each joint project are increasing in the number of projects however we find that an increase in number of joint projects of all firms lowers collective profits suggesting the presence of excessive incentives for conducting research

understanding innovation an analysis of persistence for spanish manufacturing firms abstract this study focuses on the persistence of innovation in a panel of spanish manufacturing firms for the period 1990 2008 in particular we analyse whether persistence in firms innovation activities over time is the result of previous experience the dynamic capabilities of the firm or industry market related characteristics we find that r d input and innovation output are highly persistent at the firm level after controlling for unobserved heterogeneity and initial conditions and by using a dynamic random effects probit we conclude that there are similar determinants of persistence in r d and innovative activities among external environmental factors market dynamism affects r d and innovation regarding firm specific characteristics size and outsourcing also have a positive impact on both processes past innovative behaviour is clearly more decisive in explaining the current state of r d and innovation activities than external factors or firm level heterogeneity

you can t manage right what you can t measure well technological innovation efficiency abstract this paper proposes a new approach to tackle the innovation performance relationship it addresses the so far mixed and inconclusive results of studies analyzing this relationship we argue that the undifferentiated use of innovation inputs and outputs to measure firm innovativeness is not without problems and that from a productive perspective they should be simultaneously analyzed this study follows a two stage empirical analysis using a sample of spanish manufacturing firms for the period 1992 2005 by examining two inputs and two outputs of the innovation process in the first stage we estimate technological innovation efficiency by means of an intertemporal data envelopment analysis dea bootstrap and also observe the yearly efficiency changes based on a global malmquist index in the second stage we analyze the effect of technological innovation efficiency on firm performance through a generalized method of moments gmm system the results support our arguments that the best measurement of outcomes of technological innovations is through the efficiency with which they are developed in addition we test the moderating effect of technological intensity level and firm size on the efficiency performance relationship

identification issues in the public private wage gap with an application to italy this paper reviews some of the standard assumptions that are imposed in order to estimate the average public private wage gap and that are mainly related to the possible selection of the sector there are two contributions to the existing public private wage gap literature one is a better understanding of the identified parameters standard estimators identify a local effect late which in general cannot be generalized to the entire population as instead is almost always done the other is the partial identification of the population average treatment effect with an instrumental variable to the best of my knowledge this is the first paper in this literature that employs bounds the technique is applied to male workers in italy for compliers late estimates a wage advantage from working in the public sector greater than 30 this return is within the narrowest bounds on the population average treatment effect that are consistent even with a much smaller gap about 15 or more

political aspects of innovation abstract political aspects that enhance but also undermine the positive transformational power of public innovation policies are examined as such this paper follows michal kalecki in his 1943 paper that identifies the political aspects which enhance and undermine the positive transformational power of keynesian full employment policies similarly this paper provides a policy framework that identifies what government and business support as innovation policies the role of innovation stems from schumpeter s long run perspective but incorporates the more dynamic cyclical short term and trend perspectives of kalecki this paper critiques the strategy of public innovation policy in general and derives policy implications

the effect of process management on different types of innovations an analytical modeling approach abstract we investigate the trade off between r d efficiency and creativity during the development of a new product a firm s ability to balance efficiency with innovation positively affects its capacity to maintain its competitiveness although the trade off between efficiency and creativity has long been discussed in terms of practical application little analytical research has been performed to enhance theoretical understanding to redress this gap in the literature we present an extreme value model that accounts for innovation type and competition intensity and offer a set of theoretical and practical insights to demonstrate that the effects of process management depend on the nature of the innovation employed we show that the inverse relationship between efficiency and creativity is more pronounced if r d projects represent paradigm shifting innovations rather than incremental innovations we then demonstrate how competition drives firms to decrease investment in innovation activities and improve process efficiency to maximize profit our results suggest that process management activities are less recommended for firms that pursue radical innovation and the acceleration of growth

innovation and employment a reinvestigation using revised pavitt classes the relationship between innovation and employment is addressed in this article through a model and empirical test at industry level for eight european countries in 1994 2004 we investigate this relationship for manufacturing and services and propose a revised pavitt taxonomy covering both of them in order to identify specific patterns of technological change and job creation and loss the contrasting effects of strategies of technological or cost competitiveness are investigated using innovation variables from cis2 and cis3 together with demand wages and industry dynamics they account for changes in employees and hours worked the diversity in these relations across industries is also explored when the model is applied to each revised pavitt class different mechanisms of technological change and effects on jobs emerge

on the instability of the r d portfolio in a dynamic monopoly or one cannot get two eggs in one basket abstract firms innovation portfolios include several dimensions ranging from organizational aspects to cost reduction and product characteristics all of these efforts take place during the product life cycle and interact with each other in determining the spectrum of features of the product and its performance on the market this paper contributes to the related theoretical debate focussing on the possibility of having superior product quality levels at lower marginal production cost over time to deal with this issue we investigate the optimal r d portfolio of a single product monopolist investing in cost reducing activities accompanied by efforts improving the quality of its product over an infinite time horizon it turns out that the firm s relative incentives along the two directions are conditional upon market affluence measured by consumers willingness to pay for quality and r d efforts are complements in the neighbourhood of the steady state equilibrium however the dynamics of the two r d controls depend on both quality and marginal cost at every instant consequently as the stability analysis reveals the steady state equilibrium is indeed unstable due to the dynamics of marginal cost thereby implying that one should not expect the firm to supply an increasing quality level at a decreasing production cost hence the dynamic interplay between r d controls and the resulting instability affecting production costs also imply that one may not expect to observe product quality to increase and market price to decrease over the product life cycle

instruments randomization and learning about development there is currently much debate about the effectiveness of foreign aid and about what kind of projects can engender economic development there is skepticism about the ability of econometric analysis to resolve these issues or of development agencies to learn from their own experience in response there is increasing use in development economics of randomized controlled trials rcts to accumulate credible knowledge of what works without overreliance on questionable theory or statistical methods when rcts are not possible the proponents of these methods advocate quasirandomization through instrumental variable iv techniques or natural experiments i argue that many of these applications are unlikely to recover quantities that are useful for policy or understanding two key issues are the misunderstanding of exogeneity and the handling of heterogeneity i illustrate from the literature on aid and growth actual randomization faces similar problems as does quasi randomization notwithstanding rhetoric to the contrary i argue that experiments have no special ability to produce more credible knowledge than other methods and that actual experiments are frequently subject to practical problems that undermine any claims to statistical or epistemic superiority i illustrate using prominent experiments in development and elsewhere as with iv methods rct based evaluation of projects without guidance from an understanding of underlying mechanisms is unlikely to lead to scientific progress in the understanding of economic development i welcome recent trends in development experimentation away from the evaluation of projects and toward the evaluation of theoretical mechanisms jel c21 f35 o19

firm size and the nature of innovation within industries the case of process and product r d the effect of firm size on the allocation of r d effort between process and product innovation is examined it is hypothesized that relative to product innovations process innovations are less saleable in disembodied form and spawn less growth this implies that the returns to process r d will depend more on the firm s output at the time it conducts its r d than the returns to product r d incorporating this distinction in a simple model the authors derive and test predictions about how the fraction of r d devoted to process innovation varies with firm size within industries

demand and innovation schmookler re examined schmookler s demand pull hypothesis implying that innovation is a function of market demand has been widely accepted re reading schmookler s invention and economic growth we discover a statistical inadequacy re estimating his cross section results in a different way we find somewhat lower coefficients moreover the direction of causality appears to be far from obvious an independent cross sectional test of the schmookler hypothesis in the netherlands based on r d instead of patent data shows similar results the relationship between indicators of demand and innovation turns out to be generally weaker but in most cases still significant and the results suggest that there is a simultaneous relationship between demand and innovation the latter may be explained by the concept of the innovation multiplier which has implications for macro economic modelling 1 re reading schmookler schmookler s 13 finding of a strong relationship between investment in capital goods users industries and patent applications by capital goods producing sectors has been generally accepted by economists as evidence that patenting is a function of effective demand demand pull hypothesis quite a number of case studies have followed schmookier s seminal work but there have been

sources procedures and microeconomic effects of innovation fabio arcangeli paul david frank engelman christopher freeman massimo moggi richard nelson luigi orsenigo nathan rosenberg michele salvati g n von tunzelman two anonymous referees and the participants at the meeting of the committee on distribution growth and technical progress of the italian national research council cnr rome november 16 1985 have helped with various redraftings a particularly grateful acknowledgment is for the insightful and patient help of moses abramovitz this work has been undertaken at the science policy research unit spru university of sussex as part of the research program of the designated research centre sponsored by the economic and social research council esrc earlier support to the research that led to this paper by the italian national research council cnr is also gratefully acknowledged the statistical research has been undertaken with the assistance of stephano brioschi ilaria fornari and giovannu prennushi

incentives and uncertainty an empirical analysis of the impact of demand on innovation we study the impact of demand on innovation by focusing on a sample of small and medium sized enterprises in several industries and european countries we analyse how demand stimulates innovation by providing economic incentives and reducing uncertainty considering the size of the market as a proxy for the presence of demand we find support for the idea that the presence of incentives stimulates innovation this is particularly true for process innovation in considering interaction with customers as a way to reduce uncertainty we find that firms that see customers as the most important sources of information for both innovation ideas and completion tend to introduce product innovations firm size r d expenditure and sectoral effects also matter

sharp iv bounds on average treatment effects on the treated and other populations under endogeneity and noncompliance in the presence of an endogenous binary treatment and a valid binary instrument causal effects are point identified only for the subpopulation of compliers given that the treatment is monotone in the instrument with the exception of the entire population causal inference for further subpopulations has been widely ignored in econometrics we invoke treatment monotonicity and or dominance assumptions to derive sharp bounds on the average treatment effects on the treated as well as on other groups furthermore we use our methods to assess the educational impact of a school voucher program in colombia and discuss testable implications of our assumptions

modelling r d expenditure data with zero observations two equation model this article attempts to analyse the determinants of firms research and development r d expenditures in korea by considering the business environment after the economic crisis in 1997 in addition to take into account zero r d expenditure this article employed a two equation model unlike models used in other studies this method incorporates a two level decision structure the participation decision and the decision on the amount to spend once the issue of participation has been decided according to the estimation results while the proposition that larger firms are more active in r d is true the proposition that firms that possess market power are more active in r d is not true for korea technical cooperation among korean firms seems to be less active than in other countries in addition the results indicate that foreign investment stimulates the firms r d expenditure furthermore a number of factors were found to play a role in promoting firms r d activities the external conditions of the f

research and development with asymmetric firm sizes this article presents a theoretical model of research and development r d competition among firms the goal of the model is to simultaneously explain two empirical observations pertaining to the persistence of dominantfirms small firms make a disproportionate share of major innovations while largefirms tend to spend more in absolute terms on r d than smallfirms do in the model here firms choose investment levels and r d project riskiness in equilibrium a large firm invests more than a smaller firm but by choosing safer r d projects makes fewer major innovations

innovative activity over the business cycle this paper examines cyclical patterns of innovative activity in the united kingdom over the period 1948 83 innovative activity turns out to have many of the properties of a random walk but does show a tendency to cluster during booms there is clear evidence of a long term secular relation between the level of innovative activity and the level of economic activity although this may have changed in the 1980s finally the data provide no reason for thinking that these clusters of innovation cause cyclic variations in economic activity but variations in economic activity do granger cause changes in innovative activity copyright 1995 by royal economic society

the size distribution of innovating firms in the uk 1945 1983 a survey of 4 378 significant innovations shows that firms with fewer than 1 000 employees commercialized a much larger share than is indicated by their share of r and d expenditures innovations per employee have been consistently above average in firms with more than 10 000 employees and have become so in firms with fewer than 1 000 intersectoral variation in the size distribution of innovating firms can be explained as a function of r and d based technological opportunities and of technological ease of entry by user firms with principal activities outside the sector copyright 1987 by blackwell publishing ltd

demand heterogeneity and technology evolution implications for product and process innovation the evolution of technology has been a central issue in the strategy and organizations literature however the focus of much of this work has been on what is essentially the supply side of technical change the evolution of firm capabilities we present a demand based view of technology evolution that is focused on the interaction between technology development and the demand environment in which the technology is ultimately evaluated we develop a formal computer simulation model that explicitly considers the influence of heterogeneity in market demand the presence of consumers with different needs and requirements on firms innovation choices the model is used to examine the dynamics of product and process innovation utterback and abernathy 1975 the analysis reveals that demand heterogeneity offers an alternative to supply side explanations of the technology life cycle further by considering the implications of decreasing marginal utility from performance improvements the model highlights the role of technologically satisfied consumers in shaping innovation incentives and suggests a rationale for a new stage in the technology life cycle characterized by increasing performance at a stable price the stage has not yet been treated formally in the literature but is widely observed most prominently in digital and information based technologies

the impact of order and mode of market entry on profitability and market share market share performance and profitability of overseas business activities has long been an important issue in international business in this study we explore the impact of order and mode of market entry into an overseas market we find that early entrants have significantly higher market shares and profitability than late followers we also find that equity joint ventures have a higher profitability than either wholly owned operations or contractual joint ventures a significant interaction exists between order and mode of market entry as expected firm efficiency and size affect the performance of firms these results are based on the business activities of a sample of 14 466 foreign firms in china in 1995

training wages and sample selection estimating sharp bounds on treatment effects this paper empirically assesses the wage effects of the job corps program one of the largest federally funded job training programs in the u s even with the aid of a randomized experiment the impact of a training program on wages is difficult to study because of sample selection a pervasive problem in applied microeconometric research wage rates are only observed for those who are employed and employment status itself may be affected by the training program this paper develops an intuitive trimming procedure for bounding average treatment effects in the presence of sample selection in contrast to existing methods the procedure requires neither exclusion restrictions nor a bounded support for the outcome of interest identification results estimators and their asymptotic distribution are presented the bounds suggest that the program raised wages consistent with the notion that the job corps raises earnings by increasing human capital rather than solely through encouraging work the estimator is generally applicable to typical treatment evaluation problems in which there is nonrandom sample selection attrition copyright wiley blackwell

sectoral patterns of technical change towards a taxonomy and a theory abstract the purpose of the paper is to describe and explain sectoral patterns of technical change as revealed by data on about 2000 significant innovations in britain since 1945 most technological knowledge turns out not to be information that is generally applicable and easily reproducible but specific to firms and applications cumulative in development and varied amongst sectors in source and direction innovating firms principally in electronics and chemicals are relatively big and they develop innovations over a wide range of specific product groups within their principal sector but relatively few outside firms principally in mechanical and instrument engineering are relatively small and specialised and they exist in symbiosis with large firms in scale intensive sectors like metal manufacture and vehicles who make a significant contribution to their own process technology in textile firms on the other hand most process innovations come from suppliers these characteristics and variations can be classified in a three part taxonomy based on firms 1 supplier dominated 2 production intensive 3 science based they can be explained by sources of technology requirements of users and possibilities for appropriation this explanation has implications for our understanding of the sources and directions of technical change firms diversification behaviour the dynamic relationship between technology and industrial structure and the formation of technological skills and advantages at the level of the firm the region and the country

the impact of domestic and global trade liberalisation on five southern african countries we compare the impact of alternative domestic and global trade liberalisation scenarios on five economies in southern africa the study applies a computable general equilibrium model that employs standardised 12 sector social accounting matrices for malawi mozambique tanzania zambia and zimbabwe the approach incorporates stylised features such as own household consumption and marketing margins that are of particular importance when a majority of agricultural producers are not sufficiently integrated into formal markets and thus rely on own production to meet their daily diets hence improved infrastructure implies lower marketing costs and better market integration which translates to increased production opportunities the comparison of the results across all five countries reveals that common policy measures have different impacts depending on the underlying economic structures

genetic engineering and trade panacea or dilemma for developing countries abstract advocates of the use of genetic engineering techniques in agriculture contend that this new biotechnology promises increased productivity better use of natural resources and more nutritious foods opponents are concerned about potentially adverse implications for the environment and food safety in response to consumer reactions against genetically modified gm foods in some countries crop production is being segregated into gm and non gm varieties this analysis finds that world markets for maize and soybeans adjust well to these changes and also that developing countries will divert their trade patterns in response to preference changes in important trading partner countries

distance to the frontier and the perception of innovation barriers across european countries abstract barriers to innovation have mainly been studied in a single country context this paper studies differences in the perception of innovation barriers between innovative and non innovative firms for 18 eu countries the countries are grouped by their distance to the technological frontier using community innovation surveys for the years 2002 2004 and 2004 2006 the results show that knowledge barriers related to the availability of skilled labour innovation partners and technological knowledge are more important for firms located in countries close to the frontier while the opposite is true regarding the availability of external finance moreover while the share of innovators decreases with the distance to the technological frontier the share of firms not interested or in no need of innovation increases this is consistent with the idea that as firms approach the technological frontier they increasingly need to focus on the creation of own knowledge and the adoption of innovation based growth strategies to stay competitive

firm size small business presence and sales of innovative products a micro econometric analysis in our generalized tobit analysis we identify a number of variables which have an impact on a firm s innovation output among others we find that larger firms generally have a higher probability of selling some innovative products although this probability increases less than proportionately with firm size given that a firm has some sales of innovative products the share of such products in a firm s total sales tends to be higher in smaller firms moreover a strong small business presence in a sector seems to enhance imitative innovation but has no influence on true innovations whereas market concentration has no influence on innovation output in whatever definition we also find evidence of regional knowledge spill overs furthermore our results are consistent with schmookler s hypothesis that the growth of demand enhances innovation the outcomes about the impact of r d collaboration and technology transfer on innovation remain ambiguous

the influence of market demand upon innovation a critical review of some recent empirical studies abstract a number of recent empirical studies of technical change at the level of the individual firm have concluded that market demand is the dominant influence upon the innovation process calling forth innovations in market economies the pace of innovation in the private sector heavily influences the growth of national output and productivity and these studies and their conclusions have therefore received much attention having been extensively quoted in discussions of appropriate government policy for the encouragement of innovation this paper reviews a number of these studies and concludes that their findings and the interpretations of their findings in the secondary literature are seriously flawed and in many cases invalid the proposition that market demand governs the innovation process is by no means conclusively demonstrated in these studies and they are therefore inadequate and inappropriate guides for the formulation of policy most of the studies examined employ a working definition of demand factors which is so broad as to embrace a range of possible influences upon innovation which should more properly be classified elsewhere the concept of demand utilized in these studies bears little resemblance to the more restrictive and precise definition of market demand found in economics in addition the phenomena analyzed in these studies are a very heterogeneous lot the studies do not address identical empirical questions and their findings are as a result neither uniform nor unambiguous both demand and supply side influences are crucial to understanding the innovation process and it is the exclusive preoccupation with only one set of these forces which is criticized in this paper some implications of the criticism for government policy toward innovation are discussed in the conclusion

the role of agriculture in economic development visible and invisible surplus transfers the financial surplus of agriculture has been central to theories of the role of agriculture in economic development morrisson and thorbecke mt have used a constant price social accounting matrix sam framework to measure rigorously the financial surplus of agriculture and decompose the mechanisms of surplus extraction history and theory have however stressed the role of prices as an invisible transfer mechanism in addition to the visible transfers identified in the sam framework we extend the mt approach by defining and measuring the real surplus of agriculture and decomposing the mechanisms of surplus extraction between visible and invisible financial transfers using an archetype computable general equilibrium model for poor african nations we trace the generation transfer and use of an agricultural surplus created by a productivity gain in agriculture this shows that prices indeed play an overwhelmingly important role in transferring a surplus from agriculture to the benefit of the rest of

firm leadership and innovative performance evidence from seven eu countries this paper considers the effect of different firm leadership on the innovative performance of firms from seven eu countries we investigate whether owner led or manager led firms achieve a larger share of their turnover with product innovations economic theory does not propose clear answers to this question in the empirical analysis it turns out that the manager led firms are more active innovators the share of sales based on new products is larger if firms managers do not hold any of the firms capital surprisingly there are no differences between the seven countries included in the regression analysis

incumbent innovation and domestic entry this paper analyzes the escape entry incentive for innovation by incumbent firms the threat posed by the possibility of leading edge firms entering the market influences incumbent innovation to overcome problems of endogeneity we apply an instrumental variable approach to analyze a rich firm level dataset 1987 2000 for germany we find evidence that domestic entry has a negative effect on incumbent product innovation which is a strong indication of new entrants comparative advantage in commercializing new ideas in contrast domestic entry has a positive effect on incumbent process innovations an effect also known as the escape entry effect

agricultural economics and distributional effects the paper examines the main issues surrounding distributional effects in the domains of natural resource management and land policies agricultural technology and research policies agricultural market and trade policies and consumer oriented policies including standards subsidies and labeling agriculture is drifting into an ever more drastic bifurcation at a global level and within many countries correcting that bifurcation will require large investments in rural areas and rural people in institutions and in information and biological technologies accessible by the poor in the world s smallholder sector large and growing national and international inequalities related to agriculture and rural areas threaten peace growth and sustainable development

market versus corporate structure in plant level innovation performance this paper examines the effect which market and corporate structure have on the extent of innovation for a sample of circa 300 manufacturing plants located in scotland innovation is defined as the introduction of a commercially significant new product at the establishment level the theoretical model of geroski 1990 is extended to incorporate plant level variables such as size multiplant operation the presence of r d facilities and external indigenous ownership a distinction is made between the direct and indirect effects of these variables negative binomial estimations indicate that corporate structure influences are more important in determining the number of innovations than market structure and barrier to entry variables plant size foreign ownership and the presence of r d are all positively associated with innovation direct effects greatly outweigh indirect effects tobit estimations on the number of innovations per employee support the findings of acs and audretsch 1988 that smaller enterprises are more innovation intensive than larger enterprises at least up to a limit of around 1200 employees the positive effect of r d arises principally from increasing the probability of a plant becoming an innovator rather than from making a plant more innovation intensive by contrast the importance of size lies principally in encouraging further innovations among plants which are already innovators but less than proportionately with the increase in employment size

macroeconomic conditions and the determinants of commercialisation in this paper we focus on the effects of macroeconomic conditions on commercialisation using survey data on the activities of australian inventors who attempted to commercialise 3 736 inventions over the period 1986 2005 we find evidence that macroeconomic conditions have a pro cyclical effect on commercialisation activities such a finding has important policy implications since it suggests that recessions have both short term effects on employment income and long term effects on productivity however the magnitude of the supply side effects the cost of finance and level of public sector research are estimated to be larger than the growth in aggregate or industry demand copyright the author 2010 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

is demand pulled innovation equally important in different groups of firms previous empirical literature has tested the demand pull hypothesis and found that innovation may be driven by output using a balanced panel of 216 italian manufacturing firms 1995 2000 and checking for the path dependent nature of r d we find a role of sales in inducing r d however the demand pull effect plays a varying role for different sub samples of firms exporting firms liquidity constrained firms not subsidised firms and those not heading a group seem to be sensitive to sales in deciding r d these results have been obtained using a least squares dummy variable corrected estimator a recent panel data technique suitable for small samples

a matter of location the role of regional social capital in overcoming the liability of newness in r d acquisition activities laursen k masciarelli f and reichstein t a matter of location the role of regional social capital in overcoming the liability of newness in r d acquisition activities regional studies external knowledge acquisition is a precondition for firms competitive advantage however young firms exhibit a lower propensity to acquire external research and development r d than their older counterparts the paper explores the role of regional social capital in moderating this aspect of the liability of newness the results show that young firms operating in regions with low levels of social capital are less likely to acquire r d externally however this is not the case in regions with high levels of social capital suggesting that the liability of newness in terms of acquisition of external r d does not play a role in these regions

induced innovation and energy prices this paper uses u s patent data from 1970 to 1994 to study the impact of energy prices on energy efficient innovations theories of technological change have focused both on demand side factors which spur innovative activity by increasing the value of new innovations and supply side factors such as scientific advancements that make new innovations possible data on demand side factors are easily obtained but data on supply side factors that influence innovation are not readily available this paper uses patent citations as a measure of the usefulness of the existing base of scientific knowledge citations to previous patents are used to construct productivity estimates which measure the usefulness of the existing stock of knowledge to inventors in a given energy field for any given year these estimates are then combined with data on demand side factors to estimate a model of induced innovation in energy technologies the results indicate that both energy prices and the supply of knowledge have strongly significant positive effects on innovation the paper concludes with a discussion of the implication of this work for environmental policy

the making of an oligopoly firm survival and technological change in the evolution of the u s tire industry the number of producers in the u s tire industry grew for 25 years and then declined sharply and the industry evolved to be an oligopoly the role of technological change in shaping the industry s market structure is explored a model of industry evolution featuring technological change is used to derive predictions that are tested using a novel data set on firm entry exit size location distribution networks and technological choices prior to the shakeout of producers consistent with the model earlier entering and larger firms survived longer principally because of the influence of age and size on technological change

invention and innovation in the chemical industry demand pull or discovery push abstract this paper describes a study of the determinants of the rate direction and scale of inventive and innovative activity in the chemical industry over the period 1830 1980 statistical data are interpreted in the light of case study material in three major sectors dyestuffs plastics and pharmaceuticals theories of technical change and economic growth particularly those of schmookler and schmpeter are examined in relation to this material on the chemical industry the findings suggest that the importance of demand pull and discovery push factors and the validity of schmookler s and schumpeter s theories vary over an industry s life cycle

changes in the distribution of male and female wages accounting for employment composition using bounds this paper examines changes in the distribution of wages using bounds to allow for the impact of nonrandom selection into work we show that worst case bounds can be informative however because employment rates in the united kingdom are often low they are not informative about changes in educational or gender wage differentials thus we explore ways to tighten these bounds using restrictions motivated from economic theory with these assumptions we find convincing evidence of an increase in inequality within education groups changes in educational differentials and increases in the relative wages of women

determinants of environmental innovation new evidence from german panel data sources abstract in most cases empirical analyses of environmental innovations based on firm level data relied on surveys for one point in time these surveys allow for the inclusion of many explanatory variables such as different policy instruments or the influence of pressure groups but it is not possible to address the dynamic character of environmental innovations this paper uses two german panel databases the establishment panel of the institute for employment research iab and the mannheim innovation panel mip of the centre for european economic research zew to explore the determinants of environmental innovations the econometric estimations show that the improvement of the technological capabilities knowledge capital by r d triggers environmental innovations environmental regulation environmental management tools and general organizational changes also encourage environmental innovation a result that has also been postulated by the famous porter hypothesis

network composition collaborative ties and upgrading in emerging market firms lessons from the argentine autoparts sector what types of relational and institutional mechanisms shape knowledge flows and the upgrading capabilities of emerging market firms in the face of economic liberalization we analyze the argentine autoparts sector to distinguish the relative impact of different types of network relationships on a firm s process and product upgrading a few social ties to international assemblers appear to be most beneficial for local suppliers although they may be insufficient to compensate fully for the negative effect of being located in a lower tier supplier customer relationships that are part of regular disciplined discussions for product and process improvements appear to be especially beneficial for upgrading

recent results in measuring innovation output abstract the fraunhofer institut fur systemtechnik und innovationsforschung isi is at present engaged in evaluating a number of technology policy programs designed to promote research development and innovation in small and medium sized firms these studies try to determine the extent to which these programmes have an impact upon the innovative activities of firms in this connection it was also attempted to measure the innovation output the level of innovation of a firm is innovation ouput the level of innovation of a firm is procedure involves a number of problems self assessment of firms in view of insufficient market transparency distortion due to self portraits reflecting the firms own interests we tried to mitigate such distortions by two approaches firstly firms were asked for their technologically new products the term new being applied a to the firm and b to the areas of product application as a result of this two tier procedure firms supplied rather realistic answers secondly supplementary questions were asked about sales figures the competitive technological situation nationally and internationally expenditure on r d patents stages of innovation aims of innovation etc the paper presents the results obtained to date on the innovation output of firms within the framework of an evaluation of the largest programme at present devoted to promoting r d and innovation in small and medium sized firms the results are based on a representative sample of approximately 4 500 small and medium sized firms up to 1 00 employees with r d activities in the federal republic of germany

better late than nothing some comments on deaton 2009 and heckman and urzua 2009 two recent papers deaton 2009 and heckman and urzua 2009 argue against what they see as an excessive and inappropriate use of experimental and quasi experimental methods in empirical work in economics in the last decade they specifically question the increased use of instrumental variables and natural experiments in labor economics and of randomized experiments in development economics in these comments i will make the case that this move towards shoring up the internal validity of estimates and towards clarifying the description of the population these estimates are relevant for has been important and beneficial in increasing the credibility of empirical work in economics i also address some other concerns raised by the deaton and heckman urzua papers

estimating firm size elasticities of product and process r d this paper provides an empirical test of the particular product life cycle hypothesis which postulates that the firm size elasticity of process r d exceeds the firm size elasticity of product r d panel data on german manufacturing firms is used which is affected by attrition and sample selection an inverse probability weighted generalized empirical likelihood gel estimator is proposed which corrects for the selectivity bias under the identifying assumption of conditionally independent selection and benefits from the superior small sample bias properties of gel compared to generalized method of moments gmm the product life cycle hypothesis is clearly rejected in all specifications

investigating a neglected part of schumpeter s creative army what drives new to the market innovation in micro enterprises schumpeterian arguments related to creative destruction place small entrepreneurial firms at the centre of the innovation process the exclusion of micro enterprises with less than 10 employees from most innovation surveys means however that we know relatively little about innovation among this group of firms here using new survey data on a thousand micro enterprises we explore the determinants of new to the market innovation the basis for the schumpeterian creative destruction cd process our results provide strong support for the interactive nature of micro enterprise innovation and suggest the potential value of a model of interactive creative destruction icd contrary to some other recent evidence market based and supplier based collaboration both prove important for new to the market innovation our results suggest the importance of micro enterprises as sources of new to the market innovation and the potential value of including such firms in future innovation studies

sectoral systems of innovation and production the concept sectoral system of innovation and production provides a multidimensional integrated and dynamic view of sectors it is proposed that a sectoral system is a set of products and the set of agents carrying out market and non market interactions for the creation production and sale of those products a sectoral systems has a specific knowledge base technologies inputs and demand agents are individuals and organizations at various levels of aggregation they interact through processes of communication exchange co operation competition and command and these interactions are shaped by institutions a sectoral system undergoes change and transformation through the co evolution of its various elements 2002 elsevier science b v all rights reserved

firms motivations for cooperative r d an empirical analysis of spanish firms abstract the aim of this paper is to analyze the motives that have caused industrial firms to cooperate in r d there are many theoretical works devoted to the theme but few empirical studies have been carried out with large samples to analyze the factors which determine why firms cooperate in r d we first review the reasons offered by the literature to explain technological cooperation with this allowing us to determine the conceptual framework and to propose some hypotheses we test these hypotheses with a sample of 1652 spanish firms that have carried out r d activities the results obtained suggest that firms motivations for cooperative r d are the complexity of technology and the fact that innovation is costly and uncertain we find that in order to undertake cooperative r d it is necessary to have certain internal capacities in this area with our results being supported by the theory of absorptive capacity however and by contrast with the results presented in other works questions related to market access and search for opportunities do not appear to exert an influence over cooperative r d besides the large sized firms resort more to cooperation and the reasons for cooperative r d differ as between large and small sized firms

r d portfolio and market structure this article analyses how firms allocate their resources when they compete for multiple patents in heterogeneous research projects simultaneously a simple model shows that firms resource allocation is biased away from risky and basic research even when imitation is not possible and firms are fully rational therefore a market may lack major innovations despite large aggregate research expenditure and strong patent protection this article also shows that as a market becomes more competitive firms invest relatively less in basic research but more in risky research these results provide a novel explanation for an ambiguous empirical relationship between innovation and market concentration

demand and innovation in services the case of mobile communications abstract this paper aims to analyse the pricing strategies of mobile communications operators and examine the role of demand characteristics in the development of new tariff plans in so doing we depart from a traditional industrial organization approach to price discrimination and interpret new tariff plans as innovations in the spirit of schumpeter we look at competition in this sector as depending upon this form of innovation and we argue that given the specific features of the industry the development of new tariff plans is strongly related to the users characteristics and behaviour our main point is that in a context of uncertainty demand affects firms innovative strategies in two ways first by providing information on user behaviour and by increasing the capability of market segmentation and second by providing the incentives to innovate this argument is supported by an empirical analysis carried out on the basis of an original dataset which includes all the tariff plans on offer in the history of the italian market between 1992 and 2005 we find that both a firm s installed customer base and the level of market saturation play a role in shaping firms innovative pricing strategies in terms of the number and characteristics of the new tariff plans

treatment effect bounds under monotonicity assumptions an application to swan ganz catheterization in section i we describe each of the resulting bounds when there are no other exogenous covariates that directly affect the outcome we show that if the effect of the treatment is positive and the assumptions of sv hold then the bounds of sv coincide with those of mp that assume a priori that the effect of the treatment is positive if the effect of the treatment is instead negative and the assumptions of sv hold then the bounds of sv coincide with those of mp that assume a priori that the effect of the treatment is negative hence the trade off between the analyses of sv treatment effect bounds under monotonicity assumptions an application to swan ganz catheterization

demand side vs supply side technology policies hidden treatment and new empirical evidence on the policy mix this paper provides new empirical evidence about the impact of various technological policies upon firms innovative behaviour we take into consideration the role of policies for innovative activities and we focus on their interaction while supply side policies such as r d subsidies and tax credits have been both extensively discussed in the literature and empirically investigated the analysis of innovative public procurement is a growing trend in the literature which still lacks robust empirical evidence in this paper we replicate the existing results on supply side policies surmise fresh empirical evidence on the outcome of innovative public procurement and address the issue of possible interaction among the various tools when controlling for the interaction with other policies supply side subsidies cease to be as effective as reported in previous studies and innovative public procurement seems to be more effective than other tools the preliminary evidence suggests that technology policies exert the highest impact when different policies interact

nonparametric bounds on treatment effects assume that each member of a population is characterized by values for the variables ya yb z x here x is a vector describing a person and z is a binary variable indicating which of two treatments this person receives the treatments are labelled a and b the variables ya and yb are scalar measures of the outcomes of the two treatments for example a cancer patient might be treated by a drug therapy or b surgery the relevant outcome y might be life span following treatment an unemployed worker might be given a vocational training or b job search assistance here the relevant outcome might be labor force status following treatment assume that a random sample is drawn and that one observes the realizations of z x and of the outcome under the treatment received thus ya is observed if treatment a is received but is a latent variable if treatment b is received similarly yb is either observed or latent suppose that one wants to learn the difference in expected outcome if all persons with attributes x were assigned to treatment a or b this treatment effect is

vouchers for private schooling in colombia evidence from a randomized natural experiment colombia used lotteries to distribute vouchers which partially covered the cost of private secondary school for students who maintained satisfactory academic progress three years after the lotteries winners were about 10 percentage points more likely to have finished 8th grade primarily because they were less likely to repeat grades and scored 0 2 standard deviations higher on achievement tests there is some evidence that winners worked less than losers and were less likely to marry or cohabit as teenagers benefits to participants likely exceeded the 24 per winner additional cost to the government of supplying vouchers instead of public school places

r d determinants accounting for the differences between research and development the determinants of r d are an important topic of innovation studies the classical schumpeterian hypotheses about the influence of size and market power have been complemented with the role played by industry determinants such as demand pull technological opportunity and appropriability in determining r d investments however r d has always been considered as a whole even though research and development activities differ in many aspects we take advantage of a new panel database of innovative spanish firms pitec to distinguish between research and development efforts of firms we analyze the differentiated role played by traditional r d determinants in driving research and development results show that demand pull and appropriability have a higher effect on development while technological opportunity is more influential for research differences are statistically significant important in magnitude and robust to the use of different indicators for demand pull technological opportunity and appropriability and to several robustness checks

inventor networks in renewable energies the influence of the policy mix in germany technological change and gains in efficiency of renewable power generation technologies are to a large extent driven by governmental support various policy instruments that can broadly be categorized as technology push demand pull or systemic constitute part of the policy mix for renewable energies our goal is to gain insights into the influence of this policy mix on the intensity and organization of inventive activities for wind power and photovoltaics in germany since the 1980s we examine the effect of different instruments on the size and structure of co inventor networks based on patent data our results indicate notable differences between the technologies the network size for wind power is driven by technology push and systemic instruments while in photovoltaics demand pull is decisive for network growth by and large the instruments complement each other and form a consistent mix of policy instruments the structure of the networks is driven by demand pull for both technologies systemic instruments increase interaction especially in the wind power network and are complementary to demand pull in fostering collaboration

multilevel approaches and the firm agglomeration ambiguity in economic growth studies empirical studies in spatial economics have shown that agglomeration economies may be a source of the uneven distribution of economic activities and economic growth across cities and regions both localization and urbanization economies are hypothesized to foster agglomeration and growth but recent meta analyses of this burgeoning body of empirical research show that the results are ambiguous recent overviews show that this ambiguity is fuelled by measurement issues and heterogeneity in terms of scale of time and space aggregation growth definitions and the functional form of the models applied alternatively in this paper we argue that ambiguity may be due to a lack of research on firm level performance in agglomerations this research is necessary because the theories that underlie agglomeration economies are microeconomic in nature hierarchical or multilevel modeling which allows micro levels and macro levels to be modeled simultaneously is becoming an increasingly common practice in the social sciences as illustrated by detailed dutch data on firm level productivity employment growth and firm survival we argue that these approaches are also suitable for reducing the ambiguity surrounding the agglomeration firm performance relationship and for addressing spatial sectoral and cross level heterogeneity

the anatomy of industry r d intensity distributions using firm data disaggregated by industry we establish a set of regularities in the distribution of firm r d intensities within manufacturing industries we show how a simple probabilistic process in which chance influences a key unobserved determinant of r d and firm size conditions the returns to r d can account for these regularities and other features of the distributions the model provides a unified noncausal explanation of a series of long observed relationships across mean r d intensity market concentration and the coefficient of variation it also offers a novel explanation for the inverse relationship between r d productivity and firm size jel 031