Issues in Assessing the Effect of Interindustry R&D Spillovers

This paper aims to clarify three issues concerning the weighting methodol ogy generally used to evaluate interindustry R&D spillovers. These issues concern the likely nature of the spillovers estimated through different types of supporting matrices; the similarity between input–output (IO), technology flows and technological proximity matrices; and the relevance of the assumption that a single matrix can be used for different countries. Data analyses of weighting components show that technology flows matrices are in an intermediate position between IO matrices and technological proximity matrices, but closer to the former. The various IO matrices, as well as the three technological proximity matrices, are very similar to each other. The panel data estimates of the effect of different types of interindustry R&D spillovers on industrial productivity growth in the G7 countries reject the hypotheses that a technology flows matrix can be approximated by an IO matrix and that a single IO matrix can be usedfor different countries. By transitivity, the procedure that comprises using a single technology flow for several countries is not reliable. The international comparison shows that each country benefits from different types of R&D externality. In Japan and, to a lesser extent, in the US, the rate of return to direct R&D is very high and is likely to compensate for relatively weak interindustry R&D spillover effects. In the five other industrialized countries, the reverse observation is true: strong social rates of return to R&D counterbal ance the poor performances of direct R&D.     

Estimating Regional Variations of R&D Effects on Productivity Growth by Entropy Econometrics

Abstract

In this paper we adopt an entropy econometrics-based estimator to study regional variations in regression coefficients and apply it to analyse productivity growths generated by R&D activities at a regional level. Considering the possible effects of the region's own R&D stock as well as the spillovers produced in other regions, the paper proposes the use of an entropy-based technique to estimate these effects for a specific location. Depending on the degree of heterogeneity of the set of regions analysed, it is possible that some of these regions present characteristics that enable them to more easily convert R&D efforts (generated in the region itself or obtained from other regions by R&D spillovers) into productivity gains, whereas in other regions the effect of (direct or spillover generated) R&D activities may be irrelevant. We illustrate this idea with an empirical application for Spanish regions.

RÉSUMÉ Dans la présente communication, nous adoptons un estimateur d'entropie à base économétrique pour l’étude de variations régionales des coefficients de régression et leur application pour l'analyse de d'augmentations de la productivité produites par des activités de recherche et développement à l’échelon régional. En se penchant sur les effets possibles du stock de recherches et développement propre à la région, ainsi que les retombées produites dans d'autres régions, la communication propose l'emploi d'une technique à base d'entropie pour effectuer une évaluation de ces effets pour un lieu spécifique. En fonction du degré d'hétérogénéité du groupe de régions analysé, il est possible que ces régions présentent des caractéristiques leur permettant de convertir plus facilement des interventions de recherche et développement (R&D) (générées dans cette même région, ou obtenues d'autres régions par retombées de R&D) en gains de productivité, alors que dans d'autres régions, l'effet (direct ou par retombée) d'activités de R&D pourra n'avoir aucune pertinence. Nous illustrons cette idée avec une application empirique pour des régions d'Espagne.

EXTRACTO En este estudio adoptamos un estimador basado en máxima entropía para estudiar las variaciones regionales en coeficientes de regresión, y lo aplicamos al análisis de los crecimientos de productividad generados por actividades de I+D a nivel regional. Considerando los posibles efectos del stock de I+D propio de la región, así como los spillovers producidos en otras regiones, el estudio propone el uso de una técnica basada en entropía para estimar estos efectos en relación con una ubicación específica. Dependiendo del grado de heterogeneidad del conjunto de regiones analizadas, es posible que algunas de estas regiones presenten características que les permitan convertir más fácilmente los esfuerzos de I+D (generados en la región misma u obtenidos de otras regiones a través de spillovers de I+D) en ganancias de productividad, mientras que en otras regiones el efecto de las actividades de I+D (directas o generadas de spillovers) podrían ser irrelevantes. Ilustramos esta idea con una aplicación empírica para regiones españolas.

摘要:

本文中, 我们采用基于熵计量经济学的估计器研究回归系数的区域变化, 并用它分析地域级R&D活动带来的生产率增长。考虑到区域自身R&D储备和其他区域的人才流入可能带来影响, 本文提出一种熵方法估计这些因素对某个特定区域的影响。根据所分析区域集的异质程度, 其中有些区域可能会表现出一些特征, 使其更容易将R&D能力 (该区域自己产生或者从其他区域流入)转化为生产收益, 而另外一些区域R&D活动的影响 (直接或者流入)与生产收益无关。我们以对西班牙地区的实验应用为例证明了这一论点。     

Industry evolution and R&D externalities

R&D externalities can imply ranges of aggregate increasing returns to scale in R&D. As a consequence several equilibria can exist involving different numbers of firms and different R&D investment levels. In a theoretical model the equilibrium dynamics are analyzed, showing that cyclical fluctuations of the number of firms and R&D investment may be expected, and that the long-run equilibrium is highly sensitive to investors' initial beliefs. The model is tested empirically using a unique database comprising competing firms in various R&D races.     

Impact of R&D and Technology Diffusion on Productivity Growth: Empirical Evidence for 10 OECD Countries

This paper examines the empirical evidence on the impact of performed R&D and of R&D embodied in intermediate and capital goods on productivity performance in 10 major OECD countries over the last two decades. To quantify intersectoral and international technology flows, industry-level embodied R&D variables were constructed from an input–output (IO) R&D embodiment model. The productivity variables used are discrete Divisia growth indexes of total factor productivity (TFP), which were estimated from an IO growth accounting model. The results from pooled regressions indicate that the rates of return of the R&D variables were positively significant and increasing in the 1980s. In particular, embodied R&D is an important source for TFP growth in services, indicating very high social returns of the flows of capital-embodied technology into this sector. Moreover, the information and communi-cation technology (ICT) cluster of industries played a major role in the generation and cquisition of new technologies at the international level.     

Interindustry Technology Flows and Productivity in Finnish Manufacturing

The paper examines the importance of interindustry technology flows in finnish manufacturing in the 1980s and early 1990s. An attempt is made to distinguish between embodied technology flows and spillovers, so clarifying the spillover concept.Embodied technology covers intermediate goods and capital equipment. The embodied technology data that have been used are partly based on input—output analysis, while the spillover estimates presented are based on measures of technological distance based on the industry-specific distributions of R&D expenditures. Econometric analysis of the effects of the various technology inputs on total factor productivity implies that technology embodied in foreign machinery, domestic spillovers and, to some extent, the firms' own R&D have been the most important technology sources on average.     

Environmental regulations in private and mixed duopolies: Taxes on emissions versus green R&D subsidies

In this article, we compare two kinds of environmental regulations—emissions taxes and green R&D subsidies—in private and mixed-duopoly markets in the presence of R&D spillovers. We show that a green R&D subsidy is better (worse) than an emissions tax when the green R&D is efficient (inefficient), irrespective of R&D spillovers, whereas the existence of a publicly owned firm encourages the government to adopt a subsidy policy. We also show that the optimal policy choice depends on R&D efficiency and spillovers. In particular, when green R&D is inefficient and the spillover rate is low (high), the government should choose an emissions tax and (not) privatize the state-owned firm. When green R&D is efficient, however, an R&D subsidy is better, but a privatization policy is not desirable for society, irrespective of spillovers.     

The impact of cluster connectedness on firm innovation: R&D effort and outcomes in the textile industry

Recent research into the clustering effect on firms has moved away from a simplistic view to a more complex approach. More realistic and complex causal relationships are now considered when analysing these territorial networks. Specifically, this paper attempts to analyse how cluster connectedness moderates the relationship of a firm's innovation effort and the results obtained from this effort. We want to question the commonly accepted direct and positive impact of R&D effort, and moreover, we suggest the existence of a saturation effect and that the level of cluster's inter-connectedness in the cluster moderates this effect. We have developed our empirical study focusing on the Spanish textile industrial cluster. This is a complex manufacturing industry that uses relatively low-technology manufacturing and R&D. Our findings suggest that the degree to which a firm is involved with, or connected to, other firms in the cluster can moderate the effect of the R&D effort on its innovation results. More generally, we aim to contribute to the discussion on the degree to which firms should be involved in the cluster network in order to operate efficiently and gain the maximum competitive advantages. Our findings have implications both in recent cluster and network literature as well for institutional policy.     

Creating technology candidates for disruptive innovation: Generally applicable R&D strategies

In this paper, we first examined the importance of technology creation in technological disruptive innovations (DIs), and found both academic scholars and industrial practitioners have underestimated the challenging nature and importance of technology at least in technological DI. We then moved upstream to study empirically how technology candidates could be created purposefully for potential technological DI. Four generally applicable R&D strategies were abstracted from intensive studies on 37 technological DIs, by applying the central thoughts of principal component analysis which transforms many correlated variables into a small number of uncorrelated ones. The four R&D strategies abstracted are miniaturization, simplification, augmentation and exploitation for another application. Their creation of DI was examined, postulated and then demonstrated by means of the Delphi method. The frequencies of their utilization were also compiled and the implications discussed. This study has further advanced the knowledge at the front-end of R&D, i.e. the technology perspective of DI. It hopes to facilitate more purposeful creation of technology candidates for potential technological DI in future.     

Optimal R&D investment for a risk-averse entrepreneur

Entrepreneurs investing in R&D projects face technical uncertainty associated with the cost to completion of the project, which is idiosyncratic and inherently unhedgeable. We extend existing real options models of R&D investment to incorporate the cost of bearing this unhedgeable risk and find it decreases risk-averse entrepreneurs’ valuations of R&D projects and increases the minimum NPVs required for continued investment in R&D (threshold NPVs) relative to ‘unpriced risk’ values and threshold NPVs. As in the ‘unpriced risk’ case, for less risk-averse entrepreneurs with small R&D projects, threshold NPVs remain negative and decrease with technical uncertainty. However, for sufficiently risk-averse entrepreneurs with sufficiently large R&D projects, threshold NPVs can become positive and increase with technical uncertainty.     

Measuring the Impact of Direct and Indirect R&D on the Productivity Growth of Industries: Using the Yale Technology Concordance

This paper investigates the impact of direct and indirect R&D on the productivity growth of 30 French industries during the period 1978–92. The main aim of this paper is to assess the appropriateness of the Yale Technology Concordance (YTC) as a proxy for indirect R&D flows. We compare the effect on productivity growth of the Yale proxy with the traditional proxy based on goods input–output flows, and assess their suitability for different groups of industries. Results indicate that the indirect YTC proxy performs slightly better than the traditional proxy, as a result of superior performance in the high-tech and service sectors in particular.     

Mining external R&D

Open Innovation presses the case for timely and thorough intelligence concerning research and development activities conducted outside one’s organization. To take advantage of this wealth of R&D, one needs to establish a systematic “tech mining” process. We propose a 5-stage framework that extends literature review into research profiling and pattern recognition to answer posed technology management questions. Ultimately one can even discover new knowledge by screening research databases.Once one determines the value in mining external R&D, tough issues remain to be overcome. Technology management has developed a culture that relies more on intuition than on evidence. Changing that culture and implementing effective technical intelligence capabilities is worth the effort. P&G's reported gains in innovation call attention to the huge payoff potential.     

Macroeconomic effects of R&D tax credits on small and medium enterprises

Research and development (R&D) is regarded as a core factor for the long-run performance of both large enterprises (LEs) and small and medium-sized enterprises (SMEs). This paper analyzes the economic effects of R&D tax credits by firm size. It mainly aims to compare the results of tax policies oriented towards LEs to those towards SMEs. In order to estimate the impact numerically, we use a computable general equilibrium model, which incorporates some essential characteristics of knowledge. First, we introduce a social accounting matrix that differentiates between SMEs and LEs in manufacturing industries. Then, a knowledge-based macroeconomic model estimates outcomes for policy scenarios regarding tax incentives. The results show that SMEs support more rapid growth than do LEs when the same volume of tax credits is offered to both enterprise types. We suggest that the intensity of knowledge spillovers induced by SMEs is driving this result.     

Coordination in global R&D organizations: An examination of the role of subsidiary mandate and modular product architectures in dispersed R&D organizations

International research and development (R&D) operations require a significant amount of coordination between the headquarters and the subsidiaries in order to integrate the dispersed activities in one final product. This article explores what mechanisms multinational companies (MNCs) use to coordinate their overseas R&D units. Based on a multiple case study involving nine MNCs with overseas R&D subsidiaries of varying mandates, we find that R&D sites with high technology and/or market orientation tend to be coordinated by informal mechanisms while sites with little technology and/or market orientation tend to be coordinated by formal mechanisms. Furthermore, it appears that this relationship is strongly affected by the product’s architecture: while rather complex R&D activities are conducted at the systems level and at sites with high technology orientation, less complex R&D activities are conducted at the component level at sites with low technology and market orientation. Finally, the findings suggest that modular product architectures have a coordinating effect in global R&D activities which have the power to lower firms’ overall coordination effort. The findings bear important implications for the effective coordination of MNCs’ international R&D subsidiaries.     

Managing technology licensing for stochastic R&D: from the perspective of an enterprise information system

Enterprise information technology (IT) plays an important role in technology innovation management for high-tech enterprises. However, to date most studies on enterprise technology innovation have assumed that the research and development (R&D) outcome is certain. This assumption does not always hold in practice. Motivated by the current practice of some IT industries, we establish a three-stage duopoly game model, including the R&D stage, the licensing stage and the output stage, to investigate the influence of bargaining power and technology spillover on the optimal licensing policy for the innovating enterprise when the outcome of R&D is uncertain. Our results demonstrate that (1) if the licensor has low (high) bargaining power, fixed-fee (royalty) licensing is always superior to royalty (fixed-fee) licensing to the licensor regardless of technology spillover; (2) if the licensor has moderate bargaining power and technology spillover is low (high) as well, fixed-fee (royalty) licensing is superior to royalty (fixed-fee) licensing; (3) under two-part tariff licensing and the assumption of licensors with full bargaining power, if a negative prepaid fixed fee is not allowed, two-part tariff licensing is equivalent to royalty licensing which is the optimal licensing policy; if negative prepaid fixed fee is allowed, the optimal policy is two-part tariff licensing.     

应对欧盟EUP指令，探讨机电产品生态设计方法及评价指标体系

本文针对欧盟EUP指令进行了较为深入的研究,并通过对国内有关政策法规及标准的调查分析,研究总结出一套适合机电产品的生态设计基本原则、生态设计工作基本程序等生态设计方法。同时通过分析机电产品使用寿命期内的能源消耗、材料禁用要求、材料消耗及可再生利用性、回收处理要求等诸多因素初步研究总结出机电产品环境性能评价指标体系,以帮助指导机电企业开展生态设计和评价生态产品工作。     

企业研发决策、政府资助方案及最优资助配比

本文对企业和政府在企业研发决策中研发组织方式进行了理论分析,研究了不同市场和不同决策下的政府的资助方案及最优资助配比。研究发现,在独立研发的情况下,封闭市场需要政府资助诱导企业私人研发的投入,且最优配比为1:2;出口导向型市场政府资助对企业私人研发的投入无诱导作用;进口导向型市场企业无需政府资助亦会进行私人研发投入。在产学研合作的情况下,封闭市场中支付学研机构的研发费用率k和政府资助s满足(1+s)(1-k)=1.5时达最优资助配比。     

The effects of slack resource of R&D professionals on firm performance: evidence from traditional manufacturing firms in an emerging economy

Abstract

As an important component of organizational human resource slack (HR slack), the slack of research-and-development (R&D) professionals has been studied by several authors. However, it remains unclear whether and how this small component of general HR slack, i.e. the slack of research-and-development professionals (RHR slack), may affect overall firm performance in an emerging economy without much R&D tradition or pro-R&D institutions. Based on two organizational theories, i.e. institutional theory and the resource-based view of the firm (RBV), we propose competing hypotheses on the relationship between RHR slack and firms’ accounting performance. We also examine whether the relationship between RHR slack and firm performance should be linear or curvilinear. Finally, we also test the relationship between RHR slack and other dimensions of firm performance. Several interesting findings have been obtained. For instance, neither the perspective based on institutional theory nor that based on RBV can fully predict all types of RHR slack-performance relationships, be these relationships linear or curvilinear.     

Different dimensions of knowledge in cooperative R&D projects of university scientists

An increasing speed of new knowledge generation and a growing specialization of individuals in specific fields make cooperative R&D projects indispensable to stay abreast of the latest technological developments. However, studies targeting this field of research have almost exclusively focused on industrial cooperation projects, neglecting the importance of academic R&D collaboration.We attempt to address this research gap by investigating completed R&D cooperation projects of 376 German professors of the chemical and biological sciences. Based on their evaluation, we can distinguish between successful and less successful projects mainly involving explicit or tacit knowledge. We further characterize these groups by identifying significant group differences regarding trust, the interdependency between partners, the frequency of communication and the closeness of partners. Overall, our study presents new empirical evidence that the codification of knowledge plays an important role for the success of cooperative R&D projects.     

Cooperative and noncooperative R&D with spillovers: The case of labor-managed firms

This research focuses on the behavior of not-for-profit enterprises. In particular, using a familiar model of cost-reducing R&D with spillovers, we examine strategic interactions between labor-managed firms in a duopoly. Research spillovers have not been previously considered in the context of labor-managed firms. Among four market scenarios involving (i) competition in research and production; (ii) cooperation in research and production; (iii and iv) competition or cooperation in research and the reverse in production, our results show that research is greatest under full cooperation, while output is greatest under full competition. Output and R&D are the lowest in the case when firms compete in research, but form a production cartel. The degree of research spillovers has a crucial bearing upon these rankings. Some of these results differ from those for profit-maximizing firms. The effects of changes in research spillovers on employment (output) are shown to depend upon the nature of the underlying production technology. Policy implications are discussed.