Competition and Innovation: ICT- and non-ICT-enabled Product and Process Innovations
AbstractThe reason for contradictory predictions of the models studying the impact of competi¬tion on innovation is the varying assumptions with respect to competition or innovation type. Thus, we study how the impact of competition changes with different types of innova¬tive Output. In particular, we distinguish between non-ICT - and ICT-enabled product and process innovations. To allow for such flexibility, we apply Bayesian inference techniques and use direct measures of innovative that control for the heterogeneity of innovation Output. Our analysis provides evidence that supports the hypothesis that the effect of market com¬petition on innovation is not alike for all types of innovation. We observe an inverse U-shape relationship between competition and non-ICT-enabled and a clear U-shape dependency for ICT-enabled innovations. However, the results become considerably weaker, once industry effects are taken into account. Thus, although the impact of competition on innovation varies with the type of innovation, other factors seem to have a stronger impact on the incentives to innovate.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 26239.
Date of creation: 01 Jun 2010
Date of revision:
Competition; innovation; Information and communication technologies;
Other versions of this item:
- Nepelski, Daniel, 2010. "Competition and Innovation: ICT- and non-ICT-enabled Product and Process Innovations," MPRA Paper 26243, University Library of Munich, Germany.
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- 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-2010-11-06 (All new papers)
- NEP-COM-2010-11-06 (Industrial Competition)
- NEP-CSE-2010-11-06 (Economics of Strategic Management)
- NEP-ICT-2010-11-06 (Information & Communication Technologies)
- NEP-INO-2010-11-06 (Innovation)
- NEP-KNM-2010-11-06 (Knowledge Management & Knowledge Economy)
- NEP-TID-2010-11-06 (Technology & Industrial Dynamics)
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