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Innovation and Market Structure in the Manufacturing Sector: An Application of Linear Feedback Models

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  • Yuichiro Uchida
  • Paul Cook

Abstract

In recent years, there has been a renewed interest in the relationship between market structure and innovation activities at an industry level. The paper examines the relationship between these for the manufacturing sector in a sample of 33 countries. It applies a recently developed method, based on linear feedback models, and uses cross‐country time‐series data. Despite the relatively small number of observations, the results indicate that domestic competition, external market share, and research and development have a positive effect on innovation activities. The results also suggest that the introduction of the foreign competition may have an initial positive effect on innovation activities, but over time this becomes dissipated.

Suggested Citation

  • Yuichiro Uchida & Paul Cook, 2007. "Innovation and Market Structure in the Manufacturing Sector: An Application of Linear Feedback Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 69(4), pages 557-580, August.
    • Handle: RePEc:bla:obuest:v:69:y:2007:i:4:p:557-580
    DOI: 10.1111/j.1468-0084.2007.00450.x
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    References listed on IDEAS

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    1. Hall, B. & Jaffe, A. & Trajtenberg, M., 2001. "The NBER Patent Citations Data File: Lessons, Insights and Methodological Tools," Papers 2001-29, Tel Aviv.
    2. Martin Neil Baily & Hans Gersbach, 1995. "Efficiency in Manufacturing and the Need for Global Competition," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995 Micr), pages 307-358.
    3. Sanghoon Ahn, 2002. "Competition, Innovation and Productivity Growth: A Review of Theory and Evidence," OECD Economics Department Working Papers 317, OECD Publishing.
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    Cited by:

    1. Yoshitsugu Kitazawa, 2007. "Some additional moment conditions for a dynamic count panel data model," Discussion Papers 29, Kyushu Sangyo University, Faculty of Economics, revised Aug 2008.
    2. de Rassenfosse, Gaétan & Schoen, Anja & Wastyn, Annelies, 2014. "Selection bias in innovation studies: A simple test," Technological Forecasting and Social Change, Elsevier, vol. 81(C), pages 287-299.
    3. Geronikolaou, George & Papachristou, George, 2008. "Venture Capital and Innovation in Europe," MPRA Paper 36706, University Library of Munich, Germany.
    4. Yoshitsugu Kitazawa, 2012. "An improved theoretical ground for the linear feedback model and a new indicator," Discussion Papers 58, Kyushu Sangyo University, Faculty of Economics.

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