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Why Do Some Firms Undertake R&D Whereas Others Do Not?

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  • Richard Harris
  • Mary Trainor

Abstract

Data for the UK show Northern Ireland remains at the bottom of the productivity leaguetable, and that its R&D performance is consistently amongst the lowest across the UKregions. This paper analyses the data from a survey of some 250 matched firms operating inNorthern Ireland (approximately half undertaking R&D and half not), in order to provide amore detailed analysis of attitudes to undertaking R&D in the Province. We consider a rangeof factors that determine whether R&D takes place (such as absorptive capacity, marketorientation, business objectives, and competitive advantages). Conditional on whether R&Doccurs, the analysis then looks at, firstly, the determinants of the R&D capital stock andintensity; before concentrating on those firms who undertook no R&D and analysing whichfactors might make them likely to engage in such activities in the future. Policy conclusionsare then drawn as to what might be done to boost both the amount of R&D undertaken andthe number of firms engaged in R&D in the Province.

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Bibliographic Info

Paper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number 0020.

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Date of creation: Apr 2009
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Handle: RePEc:cep:sercdp:0020

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Web page: http://www.spatialeconomics.ac.uk/SERC/publications/default.asp

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Keywords: R&D; regional policy; matching;

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  1. Sunil Kanwar & Robert E Evanson, 2004. "Does Intellectual Property Protection Spur Technological Change?," Levine's Working Paper Archive 122247000000000455, David K. Levine.
  2. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  3. Van de Ven, Wynand P. M. M. & Van Praag, Bernard M. S., 1981. "The demand for deductibles in private health insurance : A probit model with sample selection," Journal of Econometrics, Elsevier, vol. 17(2), pages 229-252, November.
  4. Acs, Zoltan J & Audretsch, David B, 1988. "Innovation in Large and Small Firms: An Empirical Analysis," American Economic Review, American Economic Association, vol. 78(4), pages 678-90, September.
  5. Jacques Mairesse & Pierre Mohnen, 2004. "The Importance of R&D for Innovation: A Reassessment Using French Survey Data," NBER Working Papers 10897, National Bureau of Economic Research, Inc.
  6. James D. Adams & Eric P. Chiang & Jeffrey L. Jensen, 2003. "The Influence of Federal Laboratory R&D on Industrial Research," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 1003-1020, November.
  7. Almeida, Paul & Dokko, Gina & Rosenkopf, Lori, 2003. "Startup size and the mechanisms of external learning: increasing opportunity and decreasing ability?," Research Policy, Elsevier, vol. 32(2), pages 301-315, February.
  8. Leahy, Dermot & Neary, J. Peter, 2007. "Absorptive capacity, R&D spillovers, and public policy," International Journal of Industrial Organization, Elsevier, vol. 25(5), pages 1089-1108, October.
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