Assessment of innovative software technology: developing an end-user-initiated interface design strategy

Knowledge intensive services and, in particular, R&D services contribute significantly to innovation in firms. The objective of this paper is to find out which characteristics of firms explain the acquisition of R&D services and to analyse whether there are differences depending on the typology of the supplier (universities, technology centres and consulting firms). Three main conclusions emerge from the econometric estimations carried out with information from a survey of innovative firms in the region of Valencia in Spain. First, the results show that firm size and age matter in the decision to buy R&D services. Second, our results are consistent with the relevance that the literature gives to human capital in absorbing external knowledge. Third, innovation policy has a significant influence on the decision to acquire R&D services, particularly from universities and technology centres.     

Battle royal in biotechnology: R&D vs. product vs. process innovations

Companies regard innovation as a central element of their business. However, as not all innovation types are the same, the central question is: should their announcements bring about the same effect on performance? This article analyses potential differences in firm value derived from the innovation-type announcements ‘R&;D’, ‘product’, and ‘process’, made by intensive news-generating firms such as biotech companies. The empirical application shows a significantly positive reaction to innovation announcements, with the prospect of future innovation (‘R&;D’ investment announcements) having greater impact on firm value than ‘product’ and ‘process’ innovations. Firm experience also acts as a moderator in this innovation–performance relationship, which is particularly relevant for entrepreneurs who need to develop and send credible signals indicating the value of the firm's intangible assets to the market.     

What was wrong with the old institutional economics (and what is still wrong with the new)?

This paper is a comparison and critique of the old and the new institutional economics, with principal focus on the former. The paper argues that the old institutional economics (OIE) lacks methodological consistency and overall persuasiveness because of the preconceptions it took from the philosophy of pragmatism and its late nineteenth-century attitude towards science. The paper starts from the methodological problem posted by Thorstein Veblen; argues that the OIE was never able to solve that problem; and then poses a resolution of Veblen's dilemma in terms of a ‘benchmark’ programme useful in appraising both the OIE and the NIE. The paper also argues that the most appealing areas of OIE rhetoric–institutions and evolution–do not distinguish that programme from the NIE. What distinguishes the OIE are the less appealing doctrines of holism and instrumental valuing. The paper closes with a brief critique of the neoclassical core of the NIE.     

R&D Investments,Information and Strategy

This paper argues that firms can best realize the value of their investments in R&D by exploiting the associated information asymmetries. Attention is directed away from the physical results of R&D and towards the firm's ability, more generally, to earn rents from the private information emanating from its R&D. Four strategies may be used to exploit the information asymmetries from R&D: (1) publish the details of the innovation in return for legal protection; (2) keep the information inside the firm; (3) make the information selectively, informally available to others; and (4) disseminate the information as widely and rapidly as possible. To implement these strategies, resources may be allocated both to the commercial development of new technologies, and/or to related market opportunities (investing in other companies, assets and technologies). Of critical importance are the innovator's own skills and resources in effectively gathering, understanding, and commercially exploiting R&D-generated information asymmetries, both internally and in relation to other firms. This study should yield new insights to managers in designing strategies (and counter-strategies) to position themselves not only at the technological edge, but more fundamentally, at the 'information edge'.     

Corporate retained earnings and personal sector saving: a test of the life-cycle hypothesis of saving

The dynamic personal saving function proposed by Swamy (1968) nests in a common framework, the life-cycle hypothesis (LCH) and the Houthakker-Taylor (1970) model of saving. Having accounted for a limitation of the generality of the Swamy result, which regards the role of corporate retention in the two models, the Swamy framework is used to test the LCH implication of perfect substitutability between personal saving and corporate retained earnings using UK data for the 1951–83 period. The empirical results cast doubt on the perfect substitution hypothesis.     

Cointegration analysis and the UK demand for nitrogen fertilizer

Nitrogen fertilizer taxes have been proposed as a means of controlling agricultural ‘over-production’ and nitrate pollution of water courses in the EC. This paper constructs time-series models of fertilizer demand which provide quantitative information relevant to this issue. Time-series data on the use of nitrogen fertilizer in UK agriculture is found to have a unit root with non-zero drift coupled with a one-time change in drift after testing against the alternative hypothesis that the process is trend-stationary with a break in trend. The stochastic component of the nitrogen use series is cointegrated with the ratio of the price of nitrogen fertilizer to the price of agricultural output. Appropriate error correction models are estimated. Both the short-run and long-run price elasticities of the response of nitrogen use are found to be rather low. Some brief policy conclusions are drawn.     

Price and quality components of imports of food products into the UK

This paper analyses the principal factors responsible for the growth in the value of imports of the UK food sector, during the period 1985-90. On the basis of estimates of translog multilateral price indices it assesses the relative contribution of changes in the quality of imported products and factors other than quality to growth in import values of food products. The main conclusion is that growth in quality appears to be the principal reason for the growth in unit values of imports and the trade deficit incurred by the food manufacturing sector.