Product Innovation in Small and Large Enterprises

Innovation networks, establishment characteristics and the regional environment are likely to play different roles in product innovation in enterprises of different size. This paper focuses on the influence of the regional environment on the early adoption of micro-electronic components in product development in small and medium-sized enterprises (SMEs) and large enterprises (LEs). Drawing upon existing literature we compare the role of enterprise characteristics, innovation networks and, in particular, the regional environment for an early use of micro-electronic components in product development in SMEs and LEs using a tobit model. Our central hypothesis is that SMEs are more dependent upon their regional environment than LEs for an early adoption. However, this hypothesis is rejected by our empirical results that show that location in a large, dense region has a significant positive effect on product innovation in LEs, while it has a negative but non-significant effect on product innovation in SMEs. Our results imply peripheral regions are able to provide an innovative environment for SMEs, whereas LEs need the richer environment offered by the core regions. The results are also interesting from a policy point of view because they indicate that SMEs can be early users of new technologies even if they are located outside the large urban areas.     

Knowledge as a Set in Idea Space: An Epistemological View on Growth

This articlepresents a model of knowledge, seen as a set of ideas definedin a multidimensional idea space. Knowledge is created throughconvex combinations of older ideas and through paradigm shifts.When normal science has made the knowledge set convex, scientificopportunity is exhausted. Individual countries are endowed withdifferent knowledge sets, which gives rise to idea gaps. Thegrowth of a country's knowledge depends on diffusion from othercountries, on own production, and on the state of its human capitaland institutions. In the long run, economic growth will dependon knowledge growth, but only paradigm shifts can save R&Dfrom diminishing returns     

Subliminal influence on generosity

We experimentally subliminally prime subjects prior to charity donation decisions by showing words that have connotations of pro-social values for a very brief time (17 ms). Our main finding is that, compared to a baseline condition, the pro-social prime increases donations by approximately 10–17 % among subjects with strong pro-social preferences (universalism values). We find a similar effect when interacting the prime with the Big 5 personality characteristic of agreeableness. We furthermore introduce a novel method for testing for priming, “subliminity”. This method reveals that some subjects are capable of recognizing prime words, and the overall results are weaker when we control for this capacity.     

Biogeography and long-run economic development

The article models the transition from a hunter-gatherer economy to agricultural production, a crucial event in history which made possible the endogenous technological progress that ultimately led to the Industrial Revolution. We further present evidence showing that geographic and initial biogeographic conditions exerted decisive influence on the location and timing of transitions to sedentary agriculture, to complex social organization and, eventually, to modern industrial production. Evidence from a large cross-section of countries indicates that the effects of geography and biogeography on contemporary levels of economic development are remarkably strong, a result that contrasts with several recent studies where the effect runs solely through institutions.     

Budesonide with multi-matrix technology as second-line treatment for ulcerative colitis: evaluation of long-term cost-effectiveness in the Netherlands

Aims: Budesonide with multi-matrix technology (MMX) is an oral corticosteroid, shown to have high topical activity against ulcerative colitis (UC) while maintaining low systemic bioavailability with few adverse events. The aim of this study was to evaluate the cost-effectiveness of budesonide MMX versus commonly used corticosteroids, in the second-line treatment of active mild-to-moderate UC in the Netherlands.

Materials and methods: An eight-state Markov model with an 8 week cycle length captured remission, four distinct therapy stages, hospitalization, possible colectomy and mortality. Remission probability for budesonide MMX was based on the CORE-II study. Population characteristics were derived from the Dutch Inflammatory Bowel Disease South Limburg cohort (n?=?598) and included patients with proctitis (39%), left-sided (42%) and extensive disease (19%). Comparators (topical budesonide foam and enema, oral budesonide and prednisolone) were selected based on current Dutch clinical practice. Treatment effects were evaluated by network meta-analysis using a Bayesian framework. Cost-effectiveness analysis was performed over a 5 year time horizon from a societal perspective, with costs, health-state and adverse event utilities derived from published sources. Outcomes were weighted by disease extent distribution and corresponding comparators.

Results: Budesonide MMX was associated with comparable quality-adjusted life year (QALY) gain versus foam and oral formulations (+0.01 QALYs) in the total UC population, whilst being cost-saving (EUR 366 per patient). Probabilistic sensitivity analysis evaluated an 86.6% probability of budesonide MMX being dominant (cost-saving with QALY gain) versus these comparators. Exploratory analysis showed similar findings versus prednisolone.

Limitations: Differing definitions of trial end-points and remission across trials meant indirect comparison was not ideal. However, in the absence of head-to-head clinical data, these comparisons are reasonable alternatives and currently offer the only comparison of second-line UC treatments.

Conclusions: In the present analysis, budesonide MMX was shown to be cost-effective versus comparators in the total UC population, for the second-line treatment of active mild-to-moderate UC in the Netherlands.     

Do financial advisors exhibit myopic loss aversion?

Myopic loss aversion (MLA) has been proposed as an explanation for the equity premium puzzle, and a number of experiments on students indicate that people do exhibit MLA. However, many people do not rely on their own judgment when making investment decisions, but obtain help from financial investment advisors on how to allocate their wealth. The preferences and choices of financial advisors are thus important for understanding investment behavior. In this paper we make use of 50 professional financial advisors to examine whether they exhibit behavior consistent with MLA. Indeed, we find that they behave consistently with MLA to a larger extent than students.     

Recombination in the open-ended value landscape of digital innovation

Digital innovation introduces a new open-ended value landscape to anyone seeking to generate or capture new value. To understand this landscape, we distinguish between design recombination and use recombination, explore how they play out together, and redirect the attention from products and services toward digital resources. Digital resources serve as building-blocks in digital innovation, and they hold the potential to simultaneously be part of multiple value paths, offered through design recombination and assembled through use recombination. Building on this perspective, we offer the value spaces framework as a tool for better understanding value creation and capture in digital innovation. We illustrate the framework and offer the early contours of a research agenda for information systems researchers.     

Impacts of Norwegian Milk Quotas on Output Growth: A Modified Distance Function Approach

Quota regulations that prevent output expansion of farms and reallocation of output between farms can cause lower growth in output and productivity. The aim of this study was to explain the output growth rate of Norwegian dairy farms since 1976, and to decompose it into output, input, socioeconomic and technical change components. Instead of using the standard distance function approach for multi‐output technologies, we use a growth rate formulation, which automatically removes the farm‐specific effects. This formulation also helps to impose non‐negativity constraints on marginal products of inputs (input elasticities), which are often violated for many observations, especially when flexible functional forms are used. The farm‐level panel data cover three periods: before the quota scheme was introduced (1976–1982); the period with the most output‐restricting quota scheme (1983–1996); and the period with a more flexible quota scheme (from 1997 onwards). Results show that the milk quota regulations had a significant constraining effect on output growth, in particular on milk output in the period 1983–1996. Furthermore, the output mix has shifted towards meat production for the average farm. What emerges from this study is that output growth and technical change are negatively influenced by policy aims where productive performance has not been the primary objective, and that there is scope for increased farm growth if the quota regime is liberalised.     

The origins of cultural divergence: evidence from Vietnam

Journal of Economic Growth - Cultural norms diverge substantially across societies, often within the same country. We propose and investigate a self-domestication/selective migration hypothesis,...