The Origins of Industrial Scientific Discoveries
AbstractThis paper estimates science production functions for R&D-performing firms in the United States using scientific papers as the measure of output, by analogy with patents. The underlying evidence covers 200 top U.S. R&D firms during 1981-1999 as well as 110 top U.S. universities. We find that industrial science builds on past scientific research inside and outside the firm, with most of the returns to scale in production deriving from outside knowledge. In turn, the largest outside contribution derives from universities rather than firms; this is especially true when papers are weighted by citations received, a measure of their importance. Consistent with the role assigned to knowledge spillovers in growth theory, the importance of outside knowledge, especially that of universities, increases from the firm to the industry level. The findings survive the inclusion of fixed effects, interactions among the effects, variations in sample and specification, and efforts to control for endogeneity.
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Date of creation: Feb 2008
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Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- 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-2008-02-16 (All new papers)
- NEP-IPR-2008-02-16 (Intellectual Property Rights)
- NEP-KNM-2008-02-16 (Knowledge Management & Knowledge Economy)
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