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A Portrait of Firms that Invest in R&D

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  • Lucia Foster
  • Cheryl Grim
  • Nikolas Zolas

Abstract

We focus on the evolution and behavior of firms that invest in research and development (R&D). We build upon the cross-sectional analysis in Foster and Grim (2010) that identified the characteristics of top R&D spending firms and follow up by charting the behavior of these firms over time. Our focus is dynamic in nature as we merge micro-level cross-sectional data from the Survey of Industrial Research and Development (SIRD) and the Business Research & Development and Innovation Survey (BRDIS) with the Longitudinal Business Database (LBD). The result is a panel firm-level data set from 1992 to 2011 that tracks firms’ performances as they enter and exit the R&D surveys. Using R&D expenditures to proxy R&D performance, we find the top R&D performing firms in the U.S. across all years to be large, old, multinational enterprises. However, we also find that the composition of R&D performing firms is gradually shifting more towards smaller domestic firms with expenditures being less sensitive to scale effects. We find a high degree of persistence for these firms over time. We chart the history of R&D performing firms and compare them to all firms in the economy and find substantial differences in terms of age, size, firm structure and international activity; these differences persist when looking at future firm outcomes.

Suggested Citation

  • Lucia Foster & Cheryl Grim & Nikolas Zolas, 2016. "A Portrait of Firms that Invest in R&D," Working Papers 16-41, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:16-41
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    References listed on IDEAS

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    Cited by:

    1. Impullitti, Giammario & Licandro, Omar & Rendahl, Pontus, 2022. "Technology, market structure and the gains from trade," Journal of International Economics, Elsevier, vol. 135(C).
    2. Aysun, Uluc, 2020. "Volatility costs of R&D," European Economic Review, Elsevier, vol. 122(C).
    3. Ufuk Akcigit & Nathan Goldschlag, 2022. "Measuring the Characteristics and Employment Dynamics of U.S. Inventors," Working Papers 22-43, Center for Economic Studies, U.S. Census Bureau.
    4. Filippo Mezzanotti & Timothy Simcoe, 2022. "Innovation and Appropriability: Revisiting the Role of Intellectual Property," Working Papers 22-09, Center for Economic Studies, U.S. Census Bureau.
    5. Lucia Foster & Cheryl Grim & John C. Haltiwanger & Zoltan Wolf, 2019. "Innovation, Productivity Dispersion, and Productivity Growth," NBER Chapters, in: Measuring and Accounting for Innovation in the Twenty-First Century, pages 103-136, National Bureau of Economic Research, Inc.
    6. Uluc Aysun & Zeynep Yom, 2019. "R&D, innovation spillover and business cycles," Villanova School of Business Department of Economics and Statistics Working Paper Series 43, Villanova School of Business Department of Economics and Statistics.
    7. Juana Sanchez & Sydney Noelle Kahmann, 2017. "R&D, Attrition and Multiple Imputation in BRDIS," Working Papers 17-13, Center for Economic Studies, U.S. Census Bureau.
    8. Akcigit, Ufuk & Dinlersoz, Emin & Greenwood, Jeremy & Penciakova, Veronika, 2022. "Synergizing ventures," Journal of Economic Dynamics and Control, Elsevier, vol. 143(C).
    9. Nikolas Zolas & Zachary Kroff & Erik Brynjolfsson & Kristina McElheran & David N. Beede & Cathy Buffington & Nathan Goldschlag & Lucia Foster & Emin Dinlersoz, 2020. "Advanced Technologies Adoption and Use by U.S. Firms: Evidence from the Annual Business Survey," NBER Working Papers 28290, National Bureau of Economic Research, Inc.
    10. Emin M. Dinlersoz & Nathan Goldschlag & Amanda Myers & Nikolas Zolas, 2018. "An Anatomy of US Firms Seeking Trademark Registration," NBER Chapters, in: Measuring and Accounting for Innovation in the Twenty-First Century, pages 183-228, National Bureau of Economic Research, Inc.
    11. Uluc Aysun & Zeynep Yom, 2021. "R&D Characteristics, Innovation Spillover, and Technology-Driven Business Cycles," Journal of Industry, Competition and Trade, Springer, vol. 21(3), pages 339-365, September.
    12. Filippo Mezzanotti & Timothy Simcoe, 2023. "Research and/or Development? Financial Frictions and Innovation Investment," Working Papers 23-39, Center for Economic Studies, U.S. Census Bureau.
    13. Uluc Aysun, 2023. "Technology diffusion and international business cycles," Working Papers 2023-02, University of Central Florida, Department of Economics.
    14. Nathan Goldschlag & Elisabeth Perlman, 2017. "Business Dynamic Statistics of Innovative Firms," Working Papers 17-72, Center for Economic Studies, U.S. Census Bureau.

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