Morphogenesis Of Social Networks And Coexistence Of Technologies ∗

The aim of the article is to relate the formation of influence networks to the coexistence of technologies in the long run. In the spirit of Plouraboue et al. (1998), we postulate that potential adopters of a technology are situated in a social network. In our model, initial relations are partly negative and all the expected utilities are revised in parallel. In the case of an exogenous network, opinions can fluctuate endlessly. When agents reallocate their relationships, this reinforces trust in agents whose opinion is close to theirs. As a result of this process, the network stabilizes in the long run, generating diversity in expected utilities.     

Appropriation Of Returns From Technological Assets And The Values Of Patents And R&D In Japanese High-Tech Firms †

This paper investigates the extent that technological assets contribute to the value of the firm, using the sample of 90 Japanese firms in pharmaceutical, chemical, and electrical equipment industries. We use the firm's R&D expenditures and the number of patents (in stock) as the measures of its technological assets and show that the relative usefulness of these two measures varies across industries. Particularly, Tobin's q is positively related to the technological assets most strongly in the pharmaceutical industry. It is also most sensitive in this industry to the level of patent stock, coinciding with the view that drug patents are more effective than other patents as a means of appropriating returns from innovation. The communications equipment industry is also characterized by its q's dependence on patent stock. In addition, this industry's q is particularly sensitive to the level of net R&D investment in the most recent year, presumably because of the rapid technological progress in this industry.     

The Dynamic ‘Diamond’: A Technological Innovation Perspective

A firm's local environment can constitute a source of national or regional cornpetitive advantage. An important question, therefore, is how these environments come about and how they can be lost. In this paper, we argue that a local environment is a function of the process of technological evolution. It is a function of how certain initial and prevailing conditions, the type of innovation, and chance events, influence the processes of uncertainty resolution, capabilities building, and survivor selection that are characteristic of technological evolution. We also argue that a region can lose its advantage when a dominant design emerges or when a technological discontinuity obsoletes the localized technological capabilities of not only manufacturers, but also of their suppliers, customers and related industries. The environment is dynamic as firms and nations, in response to their performances, also influence it by changing their strategies or policies.     

Rapid Technology Change, ‘Technological Visions’, Corporate Organisation And Market Structure

This paper is a contribution to the analysis of how rapid technology change influences market structure. The paper uses a simple simulation model to explore the effects of four main factors on the development of market structure. These are: (1) the variance (or unpredictability) of the technology trajectory; (2) the speed with which the organisation's ‘technological vision’ adjusts to ongoing technological developments; (3) the absorptive capacity of each division in the multi-divisional firm to experience gained in other divisions; (4) the extent to which competence-destroying innovations generate greater cost penalties for the division of a multi-divisional firm than for a comparable mono-divisional firm. Simultion results are obtained for 100 technological trajectories, and a variety of parameterisations. While there is a tendency for noisier trajectories to disadvantage the larger multi-divisional firm, there are conditions under which such a firm benefits from a noisy technological environment. When competence-destorying innovations affect the division of a multi-divisional firm no worse than the comparable mono-divisional firm, the multi-divisional firm is not disproportionately affected by a noisy trajectory. It may, however, be seriously damaged by a slow adjustment of technological vision, especially when all scale economies are dynamic (rather than static). The simulations confirm that the absorptive capacity of each division to experience from others can be critical in determining the ultimate market structure. A brief empirical motivation for the model is offered by reference to some case studies of the semiconductor industry.     

Market Structure And The Adoption Of Innovations: The Case Of The Spanish Banking Sector ‡

This paper is an empirical study of the determinants of adoption time for the teleprocess terminal by Spanish commercial and savings banks. The explanatory variables include the characteristics of the adopting firms, size, and in the case of the savings banks, the structure of the market and concentration. The results indicate that the speed of adoption is maximized at intermediate levels of size and market concentration, confirming one theoretical prediction of models of diffusion: namely, that adoption time is minimized at intermediate levels of market concentration.     

On Licensing Innovations And The Maintenance Of Competition ∗

Given an auction approach to the sale of licenses for a new process innovation, it is argued that a seller outside the using industry may prefer to maintain more firms than less in the using industry, particularly if this can be accomplished without loss of revenue. The basic reason is that more firms implies more competition for future modifications and improvements to the new technology. It is then shown that the seller will license at least n — 1 of the n current firms in the industry, provided the seller can choose a price composed of both a fixed fee and a royalty element. The application of the analysis is illustrated by a discussion of the Pilkington's float glass process.     

The Impact Of New Technologies On Wages: Lessons From Matching Panels On Employees And On Their Firms †

We study the impact on New Technologies (NT) on wages using a panel that matches data on individuals and on their firms. In his article on the same topic, Krueger (1993) did not give a definitive answer to the following question: if workers who use NT are better paid, is it because they are abler or because NT increases their productivity. We try to provide an answer to this question. Comparing cross-section estimates and individual fixed-effect estimates, we show that computer-based new technologies are used by abler workers. These workers learn and become more productive when they get more experienced with these NT. In terns of wage differentials, the introduction of computer-based NT contributes to a small increase. The use of firm-level data does not modify these conclusions.     

Technological Profiles And Economic Performance In The Italian Manufacturing Sector ∗

This paper applies multivariate analysis to a rich data set on technological innovation, in order to identify typical patterns of technological change. To single out the dominant forms of technological behaviour, twelve variables have been selected approximating firms' technological sources and innovation results. Multivariate analysis was applied to identify six main clusters or dominant technological profiles. Each cluster was then interpreted on the basis of a larger set of variables concerning firms' technological and economic performance. The results confirm recent emphasis placed by scholars of technical change on variety of bchaviour in technical change and industrial organization and, more specifically, Pavitt's seminal attempt at a classification of this variety. However, our clusters are somewhat more numerous than Pavitt's, thus showing a more complex combination of technological input and output. Moreover, representative industries of each cluster are less easily recognized as a less marked sectoral characterization of clusters emerges. The latter result seems to imply that variety in technological change is also shown by the existence of different technological trajectories and strategies within the same sector. We suggest that the diffuse nature of recent technical change has given firms greater freedom of strategic choice among different technological strategies.     

Network Production,Efficiency And Technological Options: Toward A New Dynamic Theory Of Telecommunications ‡

In this work we propose a new model for the analysis of telecommunications (Tlc) networks production. This represents an extension of the fund-flow model by Georgescou-Roegen originally applied to the manufacture and agriculture sectors. The adopted framework enables us to describe the functioning of a Tlc network - and the technique underlying the different types of Tlc traffic - by means of a system of multi-production where the production time profile has been clearly defined. One of the most innovative elements of our analysis is the ability to analytically represent the qualitative features of technological options. It also signals new productive options connected to new Tlc services and the introduction of new network facilities. In this way we hope to both further a theoretical understanding of the technological dynamics of the Tlc sector, and provide guidance as to the strategic choices of the economic actors involved.     

The reason for ‘The Reason of Rules’

This paper is an attempt to locate the writing of the book, The Reason of Rules, in its intellectual and temporal setting. The object is to capture something of the ambitions of the book and to assess its limitations as perceived three decades after its writing. It includes some personal reflections on the experience of Buchanan as a co-author.     

Signalling,Disclosure And The Implications Of Financial Structure For Uk Corporate R&D ∗

This paper investigates the impact of R&D disclosure and finance variables on the level of R&D expenditures. The question addressed is: what is the impact of changes in disclosure requirements on the relationship between R&D expenditure and the financing of firms? The question is motivated by the possible signalling role that elective disclosure may have had prior to changes in accounting practices to ensure R&D disclosure.     

The environmental improvement under China’s ‘New Normal’

ABSTRACT

The significant environmental improvement in China has drawn much research attention in recent years. However, in exploring the factors that lead to pollution reduction, most literature has ignored the slowing economic growth under the ‘New Normal’ of China. This omission could lead to the overestimation of the pollution reduction effects of other factors. In this paper, we estimate the effect of the economic slowdown using a dynamic Computable General Equilibrium model, CHINAGEM. We find that the contribution of the economic slowdown to pollution reduction ranges from 10% to 30%. This indicates the importance of considering the economic slowdown when evaluating the effects of other factors related to the environmental improvement in China.     

The ‘real’ explanation of the PPP puzzle

This article shows that global financial markets cannot, by themselves, achieve net transfers of financial capital and real interest rate equalization across countries and that the integration of both global financial markets and global goods markets is needed to achieve net transfers of capital and real interest rate equalization across countries. Thus, frictions (barriers to mobility) in one or both of these markets can impede the net transfer of capital between countries, produce the Feldstein and Horioka (1980) finding of high-saving-investment correlations and prevent real interest rates from being equalized across countries. Moreover, frictions in global goods markets can explain why real exchange rates deviate from purchasing power parity (PPP) for extended periods of time and can therefore also explain the PPP puzzle. Consequently, we are able to resolve two of Obstfeld and Rogoff’s (2000) ‘6 major puzzles in macroeconomics’ with essentially the same explanation.     

The Transatlantic Trade and Investment Partnership and the Role of Computable General Equilibrium Modelling: An Exercise in ‘Managing Fictional Expectations’

Negotiations between the world's two largest trading partners, the European Union (EU) and the USA, on a Transatlantic Trade and Investment Partnership (TTIP) have been ongoing since July 2013. Anticipating the controversy the agreement has sparked, EU trade policy-makers in the European Commission have put considerable effort into discursively framing the agreement on their terms. Drawing on computable general equilibrium (CGE) models of the agreement's likely impact, the central claim has been that the TTIP promises to deliver much-needed ‘growth and jobs’ without stretching the public purse at a time of austerity. Our main argument in this article, drawing on the insights of the economic sociologist Jens Beckert, is that these CGE models – and the figures they have produced – represent an important exercise in ‘managing of fictional expectations’. The models make overly optimistic predictions about the ability of the EU and the USA to eliminate regulatory barriers to trade – which are unlikely to be realised in the face of considerable political opposition – and also downplay the potential deregulatory impact of an agreement. Rather than act as a reliable guide to future outcomes, we thus show that these models serve the pro-liberalisation agenda of the European Commission and other advocates of the TTIP.     

The ‘Greater Middle East’ as a ‘Modern’ Geopolitical Imagination in American Foreign Policy

This article aims at analysing how the September 11 terrorist attacks have caused the formation of a new geopolitical vision of an area called the ‘Greater Middle East’ and how this formation has led to changes in US foreign policy towards this region. To do that, the article first presents a theoretical background against which the modern geopolitical imagination of the USA is formulated. It considers the links between national traumas/myths, geopolitical codes and visions, and foreign policy actions. The article then applies this analysis to the case of the Greater Middle East with respect to how this imagined geography shapes the foreign and security policy of the USA. It concludes that even though this imagined region has been presented in texts as justifying US-led policies with liberal underpinnings, it has in reality laid the ground for and been used for justifying US extra-territorial intervention in the region.