Effects of re-invention on industry growth and productivity: evidence from steel refining technology in Japan, 1957–1968 |
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Authors: | Tsuyoshi Nakamura |
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Institution: | Department of Economics , Tokyo Keizai University , Kokubunji, Tokyo , Japan |
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Abstract: | This paper examines the economic impact of re-invention – the degree to which an innovation is modified by user – on industry growth and productivity. The paper focuses on two re-inventions made by a Japanese steel company; these inventions improved the productive efficiency of Austrian-made refining technology, namely basic oxygen furnace (BOF). Results obtained from the plant-level production function estimation indicate that re-inventions account for approximately 30% of the total factor productivity of the BOF, substantially promoting the dissemination of the BOF technology. Our simulation analysis indeed reveals that re-inventions contributed to steel output growth by about 14%. This paper also documents that innovating companies played the role of a ‘lead user’ in developing and disseminating their re-invented technologies. |
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Keywords: | re-invention lead user total factor productivity steel |
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