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Doing R&D and/or Importing Technologies: The Critical Importance of Firm Size in Taiwan’s Manufacturing Industries

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Author Info
Chialin Chang
Stéphane Robin ()

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Abstract

We analyze the relationship between firm size and innovation inputs in Taiwan. Two inputs are considered: R&D and technology imports. Building on an existing theoretical framework, we test this relationship by estimating bivariate Tobit models in twenty 2-digit industries, using a panel of 27,754 firms observed from 1992 to 1995. We find that, in all industries, R&D intensity and/or technology imports intensity depend strongly on firm size, following an “inverted-U” pattern. Moreover, we find that most industries are only “mildly Schumpeterian”. Finally, our results provide some empirical evidence for complementarity between R&D and technology imports in the innovation process. Copyright Springer Science+Business Media, LLC 2006

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File URL: http://hdl.handle.net/10.1007/s11151-006-9114-8
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Publisher Info
Article provided by Springer in its journal Review of Industrial Organization.

Volume (Year): 29 (2006)
Issue (Month): 3 (November)
Pages: 253-278
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Handle: RePEc:kap:revind:v:29:y:2006:i:3:p:253-278

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Web page: http://www.springerlink.com/link.asp?id=100336

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Related research
Keywords: firm size; inter-industry comparisons; R&; D; technology imports; O31; O33; L25; L60;

References listed on IDEAS
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  1. Braga, Helson & Willmore, Larry, 1991. "Technological Imports and Technological Effort: An Analysis of Their Determinants in Brazilian Firms," Journal of Industrial Economics, Blackwell Publishing, vol. 39(4), pages 421-32, June. [Downloadable!] (restricted)
  2. Arora, Ashish, 1996. "Testing for complementarities in reduced-form regressions: A note," Economics Letters, Elsevier, vol. 50(1), pages 51-55, January. [Downloadable!] (restricted)
  3. Arora, Ashish & Gambardella, Alfonso, 1990. "Complementarity and External Linkages: The Strategies of the Large Firms in Biotechnology," Journal of Industrial Economics, Blackwell Publishing, vol. 38(4), pages 361-79, June. [Downloadable!] (restricted)
  4. Kohn, Meir & Scott, John T, 1982. "Scale Economies in Research and Development: The Schumpeterian Hypothesis," Journal of Industrial Economics, Blackwell Publishing, vol. 30(3), pages 239-49, March. [Downloadable!] (restricted)
  5. Honore, Bo E., 1993. "Orthogonality conditions for Tobit models with fixed effects and lagged dependent variables," Journal of Econometrics, Elsevier, vol. 59(1-2), pages 35-61, September. [Downloadable!] (restricted)
  6. Cohen, Wesley M. & Levin, Richard C., 1989. "Empirical studies of innovation and market structure," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 18, pages 1059-1107 Elsevier. [Downloadable!] (restricted)
  7. Scott, John T., 2005. "Corporate social responsibility and environmental research and development," Structural Change and Economic Dynamics, Elsevier, vol. 16(3), pages 313-331, September. [Downloadable!] (restricted)
  8. Scherer, F. M., 1982. "Inter-industry technology flows in the United States," Research Policy, Elsevier, vol. 11(4), pages 227-245, August. [Downloadable!] (restricted)
  9. William L. Baldwin, 1962. "Contracted Research and the Case for Big Business," Journal of Political Economy, University of Chicago Press, vol. 70, pages 294. [Downloadable!] (restricted)
  10. Veugelers, Reinhilde & Cassiman, Bruno, 1999. "Make and buy in innovation strategies: evidence from Belgian manufacturing firms," Research Policy, Elsevier, vol. 28(1), pages 63-80, January. [Downloadable!] (restricted)
  11. Marcel Dagenais & Pierre Mohnen, 2000. "Towards an Innovation Intensity Index: The Case of CIS 1 in Denmark and Ireland," CIRANO Working Papers 2000s-20, CIRANO. [Downloadable!]
  12. Fisher, Franklin M & Temin, Peter, 1973. "Returns to Scale in Research and Development: What Does the Schumpeterian Hypothesis Imply ?," Journal of Political Economy, University of Chicago Press, vol. 81(1), pages 56-70, Jan.-Feb.. [Downloadable!] (restricted)
  13. Verbeek, Marno, 1990. "On the estimation of a fixed effects model with selectivity bias," Economics Letters, Elsevier, vol. 34(3), pages 267-270, November. [Downloadable!] (restricted)
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