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Innovations from SMEs or large firms? : sector structure and dynamics

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  • W.A. Dolfsma
  • G. van der Panne

Abstract

In this paper we investigate which elements in both an industry’s structure and in an industry’s dynamics affect innovativeness. We use the most appropriate measure for innovativeness –new product announcements- to find specifically that dominance of large firms consistently affect industry innovativeness negatively. Other industry structure characteristics are surprisingly consistent across different model specifications. Our findings for indicators of industry dynamics are noteworthy for instance as they contrast with the ILC predication that firm entry will boost innovativeness.

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Bibliographic Info

Paper provided by Utrecht School of Economics in its series Working Papers with number 07-30.

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Length: 27 pages
Date of creation: 2007
Date of revision:
Handle: RePEc:use:tkiwps:0730

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Keywords: Innovation; small vs large firms; industry structure; industry dynamics; industry life cycle;

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  1. Geroski, Paul A. & Mata, Jose, 2001. "The evolution of markets," International Journal of Industrial Organization, Elsevier, vol. 19(7), pages 999-1002, July.
  2. Mark A. Lemley & Carl Shapiro, 2005. "Probabilistic Patents," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 75-98, Spring.
  3. Gerben Van Der Panne & Wilfred Dolfsma, 2003. "The odd role of proximity in knowledge relations: high-tech in the Netherlands," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 94(4), pages 453-462, 09.
  4. Gerosky, P A & Pomroy, R, 1990. "Innovation and the Evolution of Market Structure," Journal of Industrial Economics, Wiley Blackwell, vol. 38(3), pages 299-314, March.
  5. Philippe Aghion & Nicholas Bloom & Richard Blundell & Rachel Griffith & Peter Howitt, 2002. "Competition and innovation: an inverted U relationship," IFS Working Papers W02/04, Institute for Fiscal Studies.
  6. Dolfsma, W.A. & Leydesdorff, L. & van der Panne, G., 2004. "Measuring the Knowledge Base of an Economy in terms of Triple-Helix Relations among 'Technology, Organization, and Territory'," ERIM Report Series Research in Management ERS-2004-034-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni.
  7. Boone, J., 2000. "Competitive pressure: The effects on investments in product and process innovation," Open Access publications from Tilburg University urn:nbn:nl:ui:12-84400, Tilburg University.
  8. Acs, Zoltan J & Audretsch, David B & Feldman, Maryann P, 1994. "R&D Spillovers and Recipient Firm Size," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 336-40, May.
  9. Kamien, Morton I & Schwartz, Nancy L, 1975. "Market Structure and Innovation: A Survey," Journal of Economic Literature, American Economic Association, vol. 13(1), pages 1-37, March.
  10. Geroski, P A, 1990. "Innovation, Technological Opportunity, and Market Structure," Oxford Economic Papers, Oxford University Press, vol. 42(3), pages 586-602, July.
  11. Gerben Panne, 2004. "Agglomeration externalities: Marshall versus Jacobs," Journal of Evolutionary Economics, Springer, vol. 14(5), pages 593-604, December.
  12. Malerba, Franco & Orsenigo, Luigi, 1997. "Technological Regimes and Sectoral Patterns of Innovative Activities," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 83-117.
  13. Acs, Zoltan J & Audretsch, David B, 1988. "Innovation in Large and Small Firms: An Empirical Analysis," American Economic Review, American Economic Association, vol. 78(4), pages 678-90, September.
  14. Richard Blundell & Rachel Griffith & John Van Reenen, 1994. "Dynamic count data models of technological innovation," IFS Working Papers W94/10, Institute for Fiscal Studies.
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