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R&D Drivers in Young Innovative Companies

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Author Info

  • García-Quevedo, José

    ()
    (University of Barcelona)

  • Pellegrino, Gabriele

    ()
    (University of Barcelona)

  • Vivarelli, Marco

    ()
    (Università Cattolica del Sacro Cuore)

Abstract

This paper examines the determinants of young innovative companies' (YICs) R&D activities taking into account the autoregressive nature of innovation. Using a large longitudinal dataset comprising Spanish manufacturing firms over the period 1990-2008, we find that previous R&D experience is a fundamental determinant for mature and young firms, albeit to a smaller extent in the case of the YICs, suggesting that their innovation behaviour is less persistent and more erratic. Moreover, our results suggest that firm and market characteristics play a distinct role in boosting the innovation activity of firms of different age. In particular, while market concentration and the degree of product diversification are found to be important in fostering R&D activities in the sub-sample of mature firms only, YICs' spending on R&D appears to be more sensitive to demand-pull variables, suggesting the presence of credit constraints. These results have been obtained using a recently proposed dynamic type-2 tobit estimator, which accounts for individual effects and efficiently handles the initial conditions problem.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6136.

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Length: 33 pages
Date of creation: Nov 2011
Date of revision:
Publication status: forthcoming in: Research Policy, 2014
Handle: RePEc:iza:izadps:dp6136

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Keywords: Young Innovative Companies (YICs); innovation; R&D; dynamic type-2 tobit estimator;

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References

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Cited by:
  1. Segarra Blasco, Agustí, 1958- & Gombau, Verònica, 2013. "Young innovative firms and R&D strategies: is the Spanish case different?," Working Papers 2072/222200, Universitat Rovira i Virgili, Department of Economics.

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