Doing R&D or not, that is the question (in a crisis…)
AbstractThis study investigates how corporate R&D evolves in the light of the contemporary economic crisis. We investigate what empirical evidence from past downturns suggests, discuss the relevant literature and perform an empirical analysis of recent business survey data (collected during 2009). We question whether companies tend to spend more or less on R&D and innovation activities during periods of recession and analyse empirically what general patterns can be distinguished in this regard, given the particular circumstances of the most recent crisis. Our findings suggest that company behaviour varies: some companies have reduced their innovation activities significantly, while others maintained them and a third group even increased their activities to reap the benefits in the expected upswing afterwards. Overall, we observe a deceleration of R&D and innovation activities in the light of the crisis, but the trend figures remain positive. Driven by the companies that reinforce their R&D and innovation efforts to thrive through the downturn and thus seek to gather the benefits in the upswing to come, the R&D and innovation landscape is likely to look different in the aftermath of the crisis. These changes will inevitably affect policy intervention in the field of innovation and are a unique chance for the reorientation of policy measures. More profoundly, they could be at the roots of a new paradigm, departing from a transition from an industrial to a knowledge-based society.
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Bibliographic InfoPaper provided by Institute of Prospective Technological Studies, Joint Research Centre in its series JRC-IPTS Working Papers on Corporate R&D and Innovation with number 2010-12.
Length: 36 pages
Date of creation: Dec 2010
Date of revision:
Corporate R&D investments; innovation activities; company strategy; economic crisis; R&D globalization;
Find related papers by JEL classification:
- F01 - International Economics - - General - - - Global Outlook
- G01 - Financial Economics - - General - - - Financial Crises
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-03 (All new papers)
- NEP-CFN-2011-01-03 (Corporate Finance)
- NEP-INO-2011-01-03 (Innovation)
- NEP-SBM-2011-01-03 (Small Business Management)
- NEP-TID-2011-01-03 (Technology & Industrial Dynamics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- von Zedtwitz, Maximilian & Gassmann, Oliver, 2002. "Market versus technology drive in R&D internationalization: four different patterns of managing research and development," Research Policy, Elsevier, vol. 31(4), pages 569-588, May.
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