In-house R&D,external R&D and cooperation breadth in Spanish manufacturing firms: is there a synergistic effect on innovation outputs?

ABSTRACT

This study explores the nature of relationship between in-house R&D, external R&D and cooperation breadth and their joint impact on patent counts as well as technological, product and process, innovations in Spanish manufacturing firms. With regards to patent counts, empirical findings from a Generalized Method of Moments (GMM) estimator suggest a complementarity effect of internal and external R&D activities conditional on the breadth of R&D cooperation. Concerning technological innovation, results from dynamic random-effects probit models indicate no synergistic effects. In addition, we find evidence of persistence of all three innovation output measures. Our results suggest policy implications in relation to strengthening firms’ absorptive capacity that could have long-run effects.     

R&D expenditures and firm growth – is small beautiful?

ABSTRACT

This paper examines how efficiently different groups of firms use their R&D expenditures. To this end, it investigates how the empirical relationship between firms' R&D expenditures and their sales growth varies with different values of firm size, firm age, and the number of firms in the respective industry. Using panel data for Switzerland ranging from 1995 to 2012, the paper finds that smaller, more mature firms show a more positive relation between R&D expenditures and sales growth than both relatively larger or younger firms. The paper argues that, on the one hand, these firms can benefit from various small size advantages in the R&D process, such as more motivated researchers, caused by a stronger connection to the firm's fate. On the other hand, these firms can also benefit from a well-established R&D department that allows absorbing the latest technological developments. The paper further finds that industries consisting of many small firms show a more positive relation between R&D expenditures and sales growth than industries consisting of only a few large firms. The intuition behind this result is that industries consisting of many small firms imply more independent innovative trials, which then together result in a higher probability of discovering successful innovations. In sum, the paper finds that groups consisting of a large number of small, more mature firms spend their R&D in the most efficient way.     

R&D in Indian manufacturing enterprises: what shapes it?

The article examines the factors influencing research and development (R&D) in manufacturing entities. Using data on a large sample of companies for the period 1995–2007, the finding indicates that large companies have a higher probability of pursuing R&D, although with lower intensity. In terms of magnitudes, a 10% increase in firm size raises R&D intensity by roughly 0.6%. Both the intensity and the probability of undertaking R&D initially declines for older firms. Outward orientation, and especially foreign currency earnings, has a significant bearing on R&D efforts. R&D efforts are also found to vary significantly across firm ownership.     

Can privatization be a catalyst for environmental R&D and result in a cleaner environment?

In this paper we explore whether privatization helps to catalyze a firm's environmental research and development (ER&D) and improve environmental quality. By defining ER&D as the effort undertaken by a firm to reduce its pollution per unit of output, we find in a duopoly framework that privatization cannot catalyze both public and private firms’ ER&D efforts simultaneously; it can increase one but decrease the other firm's investment, or it may even lower both firms’ ER&D investments. Moreover, when production causes severe environmental damage, or the imposition of environmental taxes poorly internalize the pollution externality, privatization may result in a poorer environment. For the sake of having a cleaner environment, policy-makers can impose higher environmental taxes on a highly polluting industry when it is being privatized.     

Intellectual property rights and R&D subsidies: are they complementary policies?

IPR protection and R&D subsidy are simultaneously implemented in many economies. Are they complementary policies for improving the welfare of consumers? We address this question in a dynamic general equilibrium model with innovation-driven growth. Under concave utility, the answer is yes for two cases: (1) the economy does not begin from steady state and the elasticity of intertemporal substitution (EIS) is relatively large; (2) the economy begins from steady state with either a sufficiently small initial consumption and a relatively large EIS or a sufficiently big initial consumption and a relatively small EIS. Under linear utility, the answer is yes if the discounted lifetime utility is finite in equilibrium, no matter the economy begins from the steady state or not. As empirical evidence finds cross-country heterogeneity in EIS, they are not complementary for all economies. We also identify reasonable cases whereby they are substitute policies, so we show when it is not welfare-enhancing to simultaneously implement both policies.     

Reverse causality in the R&D–patents relationship: an interpretation of the innovation persistence

Starting from the failure of the R&D–patents traditional relationship, when time-series and/or within-industry dimensions are included in the empirical analysis, the present work tries to contribute to the empirical literature from two directions. First, it performs a Granger causality test based on the theoretical presumption of a reverse patents→R&D link as an explanation for the failure of the traditional relationship. Second, assuming the reverse patents–R&D causality, we test and interpret the lag structure of such a relationship which shows the effective patent life that firms can expect within the two Schumpeterian patterns of innovations they belong to. In the light of the effective patent life, we offer a further explanation of innovation persistence which overturns the findings of the existing literature on persistence.     

Should environmental R&D be prioritized?

An innovator may not be able to capture the full social benefit of her innovation and, therefore, governments support private R&D through various measures. We compare a market good innovation—to develop a more efficient technology to produce a standard market good—with an environmental innovation—to develop a more efficient abatement technology—that has the same potential to increase the social surplus. In the first-best outcome, which can be achieved by offering an R&D subsidy and a diffusion subsidy, the R&D subsidy should be greatest for an environmental innovation, whereas the diffusion subsidy should be greatest for a market good innovation. The ranking of the two types of subsidies reflects that the appropriability problem is greater for an environmental innovation than for a market good innovation.     

东莞市政府R&D资助对企业R&D支出的影响

本文根据2012年至2014年东莞市7家具备创新规模并且连续接受政府R&D资助的上市企业的数据,考察了东莞市政府的R&D投入对7家上市企业的R&D投入的影响.分析结果显示东莞市政府的R&D投入的增加并没有对企业的R&D支出产生显著的杠杆效应,反而有部分对企业的R&D投入产生了挤出效应.     

What is the optimal rate of R&D investment to maximize productivity growth?

Governments in modern economies devote much policy attention to enhancing productivity and continue to emphasize its drivers such as investment in R&D. This paper analyzes the relationship between productivity growth and levels of R&D investments. The econometric analysis shows that more than 65 per cent of productivity growth variance is due to its dependence on gross domestic expenditure on R&D expressed as percentage of GDP (GERD). Economic analysis shows that productivity growth = f(GERD) is a concave function downwards due to diminishing returns to research investments. In addition, the research shows that the range of GERD between 2.3 per cent and 2.6 per cent maximizes the long-run impact on productivity growth and it is the key to sustained productivity and technology improvements that are becoming more and more necessary to modern economic growth.     

Tax cuts and enterprises’ R&D intensity: Evidence from a natural experiment in China

This paper studies the impact of tax cuts on enterprises’ R&D intensity. We use a natural experiment involving China’s business tax changing to value-added tax (“BT to VAT”) to identify any causality. The results reveal that this tax reform has prompted enterprises to increase their research and development (R&D) investment. Specifically, a stronger ability to transfer tax, results in this change having a more significant promotional effect on enterprises’ R&D intensity. Further analysis demonstrates that firms with different ownership types and in different industries respond differently to the “BT to VAT” policy. Our findings are only significant for non-state-owned and other modern service enterprises. This paper provides a theoretical and empirical basis for detailed analyses of the effects of “BT to VAT” policy, particularly the government’s subsequent improvement to the tax reform policy, to further stimulate enterprise investments in R&D as well as industrial upgrading.     

Nurse retention: is it worth it?

Nurse turnover costs thousands of dollars and negatively affects patient outcomes. Study results indicate experienced nurses perceive decreased autonomy and task orientation, and increased work pressure in their work environments. Strategies are presented to help retain RNs, save money, and improve patient outcomes.     

R&D efficiency and heterogeneity – a latent class application for the OECD

Expenditures devoted to research and development (R&D) are scarce and thus need to be used as efficiently as possible given the financial constraints countries are facing. This article assesses the relative efficiency of R&D expenditures for 26 OECD member countries and two nonmember countries. As countries differ in their national innovation systems and states of economic development and industrialization, e.g. transition economies in Eastern Europe versus Asian countries versus Anglo-Saxon countries, the measurement of R&D efficiency needs to consider differences in the technology of knowledge production. By means of a latent class model for stochastic frontiers, we relax the assumption of a homogeneous technology frontier and model technological differences in knowledge production among countries. Empirical evidence suggests the existence of different classes stressing the importance of accounting for countries’ disparities within R&D efficiency analysis.     

Self-funding health insurance for small employers: is it the right way to go?

Self-funding offers small employers an alternative approach to providing health care benefits for their employees. It may not be appropriate for every small employer but, in situations where it is feasible, self-funding offers employers a way to get a measure of control over health care costs while providing the benefits employees expect.     

Can a larger market foster R&D under monopolistic competition with variable mark-ups?

We study monopolistic competition with symmetric directly additive preferences (generating variable mark-ups) and an endogenous technology choice. Each firm chooses an investment in R&D to decrease its marginal cost. We prove that the equilibrium R&D investment increases with market size (a larger population or trade) only if the price-elasticity of demand is an increasing function. Together with the output levels, such equilibrium investments may be socially excessive or insufficient, depending on whether the elasticity of the subutility is increasing or decreasing. The main implication is that opening up to free trade can foster R&D through variable mark-ups.     

Who knows it is a game? On strategic awareness and cognitive ability

We examine strategic awareness in experimental games, that is, the question of whether subjects realize they are playing a game and thus have to form beliefs about others’ actions. We conduct a beauty contest game and elicit measures of cognitive ability and beliefs about others’ cognitive ability. We show that the effect of cognitive ability is highly non-linear. Subjects below a certain threshold choose numbers in the whole interval and their behavior does not correlate with beliefs about others’ ability. In contrast, subjects who exceed the threshold avoid choices above 50 and react very sensitively to beliefs about the cognitive ability of others.     

Measuring universities’ R&D performance in China’s provinces: a multistage efficiency and effectiveness perspective

ABSTRACT

Evaluating universities’ R&D performance can serve as a tool for policymakers, enabling them to identify the best R&D practitioners for benchmarking and develop strategies for enhancing performance by highlighting areas of weakness. This study divides universities’ R&D performance into two dimensions: efficiency and effectiveness. We employ a network data envelopment analysis approach to measure universities’ R&D efficiency, and separately use a multi-index comprehensive evaluation method to assess their R&D effectiveness from a multistage perspective. We calculate the comprehensive R&D performance of universities in 30 provinces in China from 2004 to 2014. An analysis of temporal variation reveals that universities’ R&D performance in some provinces improved rapidly, increasing gaps in performance as a whole. The spatial pattern for the 30 provinces shows that universities in provinces with medium or strong R&D performance are mainly in coastal provinces and central areas in China. Finally, universities’ R&D activities are considered ‘efficient and effective’ only in a small number of provinces, while in most provinces, these activities can generally be considered ‘less efficient and effective.’ Hence, universities in provinces with different R&D performance modes should implement targeted improvement strategies according to their characteristics.     

The productivity impact of R&D investment: are high-tech sectors still ahead?

Our aim is to investigate the relationship between a firm's R&D expenditures and its productivity, looking at sectoral peculiarities. We use a unique longitudinal database consisting of 1809 US and European manufacturing and service firms over the period 1990–2008. Our main findings can be summarised as follows. Consistently with previous literature, the knowledge stock has a significant positive impact on a firm's productivity. More interestingly, the coefficient turns out to be significantly larger in the R&D-user services and high-tech manufacturing sectors than in the non-high-tech manufacturing sectors. Contrary to the ‘latecomer advantage’ approach, these outcomes suggest that firms in high-tech sectors are still ahead in terms of impact on productivity of R&D investments.