Policy Simulation of Firms Cooperation in Innovation
AbstractThis study utilizes results from an agent-based simulation model to conduct public policy simulation of firms’ networking and cooperation in innovation. The simulation game investigates the differences in sector responses to internal and external changes, including cross-sector spillovers, when applying three different policy strategies to promote cooperation in innovation. The public policy strategies include clustering to develop certain industries, incentives to encourage cooperative R&D and spin-off policies to foster entrepreneurship among R&D personnel. These policies are compared with the no-policy alternative evolving from the initial state serving as a benchmark to verify the gains (or loses) in the number of firms cooperating and networking. Firms’ behavior is defined according to empirical findings from analysis of determinants of firms’ participation in cooperation in innovation with other organizations using the Korean Innovation Survey. The analysis based on manufacturing sector data shows that firms’ decision to cooperate with partners is primarily affected positively by firm’s size and the share of employees involved in R&D activities. Then, each cooperative partnership is affected by a different set of determinants. The agent-based models are found to have a great potential to be used in decision support systems for policy makers. The findings indicate possible appropriate policy strategies to be applied depending on the target industries. We have applied few examples and showed how the results may be interpreted. Guidelines are provided on how to generalize the model to include a number of extensions that can serve as an optimal direction for future research in this area.
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Bibliographic InfoPaper provided by Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies in its series Working Paper Series in Economics and Institutions of Innovation with number 357.
Length: 25 pages
Date of creation: 27 Mar 2014
Date of revision:
Contact details of provider:
Postal: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Phone: +46 8 790 95 63
Web page: http://www.infra.kth.se/cesis/
More information through EDIRC
agent-based simulation; collaborative R&D; innovation networks; simulation game; policy strategy;
Find related papers by JEL classification:
- C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-04-11 (All new papers)
- NEP-CMP-2014-04-11 (Computational Economics)
- NEP-CSE-2014-04-11 (Economics of Strategic Management)
- NEP-ENT-2014-04-11 (Entrepreneurship)
- NEP-GER-2014-04-11 (German Papers)
- NEP-IND-2014-04-11 (Industrial Organization)
- NEP-INO-2014-04-11 (Innovation)
- NEP-KNM-2014-04-11 (Knowledge Management & Knowledge Economy)
- NEP-SBM-2014-04-11 (Small Business Management)
- NEP-TID-2014-04-11 (Technology & Industrial Dynamics)
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