IDEAS home Printed from https://ideas.repec.org/a/kap/jtecht/v48y2023i6d10.1007_s10961-022-09951-z.html
   My bibliography  Save this article

Too many or too few Standards Setters? Evidence from the Performance of Firms engaged in Standardization

Author

Listed:
  • Cesare A.F. Riillo

    (STATEC -National Institute of Statistical and Economic Studies of Luxembourg-)

  • Kai Jakobs

    (RWTH Aachen University)

Abstract

Theoretical models suggest that standardisation activities in the market may be too high or too low with respect to the market optimum. This paper investigates the association of standardisation engagement with firms’ performance as indirect evidence of a sub-optimal level of market standardisation activities. Anecdotal evidence has it that firms can benefit from engagement in standardisation activities, but large quantitative studies on this topic are rather scarce. Based on a large innovation survey, this paper implements matching models to compare outcomes of firms with similar features but different standardisation activities. The outcomes of interest are several measures of innovation and growth. Standardisers and non-standardisers are matched onto a rich set of control variables. Firms engaged in standardisation have better innovation performance than firms with no such activities. However, the results for the performance measures are rather mixed, showing no association or negative association with labour productivity measures. Heteroscedasticity-based instruments mitigate possible endogeneity issues. These results can be interpreted as indirect evidence of low standardisation activity in the market, possibly due to long payback periods and appropriability issues of the standardisation investment.

Suggested Citation

  • Cesare A.F. Riillo & Kai Jakobs, 2023. "Too many or too few Standards Setters? Evidence from the Performance of Firms engaged in Standardization," The Journal of Technology Transfer, Springer, vol. 48(6), pages 2106-2131, December.
    • Handle: RePEc:kap:jtecht:v:48:y:2023:i:6:d:10.1007_s10961-022-09951-z
    DOI: 10.1007/s10961-022-09951-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10961-022-09951-z
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10961-022-09951-z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Hussinger, Katrin & Pacher, Sebastian, 2019. "Information ambiguity, patents and the market value of innovative assets," Research Policy, Elsevier, vol. 48(3), pages 665-675.
    2. James J. Heckman & Petra E. Todd, 2009. "A note on adapting propensity score matching and selection models to choice based samples," Econometrics Journal, Royal Economic Society, vol. 12(s1), pages 230-234, January.
    3. Baron, Justus & Ménière, Yann & Pohlmann, Tim, 2014. "Standards, consortia, and innovation," International Journal of Industrial Organization, Elsevier, vol. 36(C), pages 22-35.
    4. Pierre Azoulay & Toby Stuart & Yanbo Wang, 2014. "Matthew: Effect or Fable?," Management Science, INFORMS, vol. 60(1), pages 92-109, January.
    5. James J. Heckman, 2008. "Econometric Causality," International Statistical Review, International Statistical Institute, vol. 76(1), pages 1-27, April.
    6. Deng, Xin & Li, Qian Cher & Mateut, Simona, 2022. "Participation in setting technology standards and the implied cost of equity," Research Policy, Elsevier, vol. 51(5).
    7. Acemoglu, Daron & Gancia, Gino & Zilibotti, Fabrizio, 2012. "Competing engines of growth: Innovation and standardization," Journal of Economic Theory, Elsevier, vol. 147(2), pages 570-601.3.
    8. Marc Rysman & Timothy Simcoe, 2008. "Patents and the Performance of Voluntary Standard-Setting Organizations," Management Science, INFORMS, vol. 54(11), pages 1920-1934, November.
    9. Knut Blind, 2006. "Explanatory factors for participation in formal standardisation processes: Empirical evidence at firm level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(2), pages 157-170.
    10. Wiegmann, Paul Moritz & de Vries, Henk J. & Blind, Knut, 2017. "Multi-mode standardisation: A critical review and a research agenda," Research Policy, Elsevier, vol. 46(8), pages 1370-1386.
    11. Tether, Bruce S. & Hipp, Christiane & Miles, Ian, 2001. "Standardisation and particularisation in services: evidence from Germany," Research Policy, Elsevier, vol. 30(7), pages 1115-1138, August.
    12. Matthew Blackwell & Stefano Iacus & Gary King & Giuseppe Porro, 2009. "cem: Coarsened exact matching in Stata," Stata Journal, StataCorp LP, vol. 9(4), pages 524-546, December.
    13. Seok-Woo Kwon, 2008. "Does the Standardization Process Matter? A Study of Cost Effectiveness in Hospital Drug Formularies," Management Science, INFORMS, vol. 54(6), pages 1065-1079, June.
    14. Joseph Farrell & Garth Saloner, 1988. "Coordination through Committees and Markets," RAND Journal of Economics, The RAND Corporation, vol. 19(2), pages 235-252, Summer.
    15. Bekkers, Rudi & Duysters, Geert & Verspagen, Bart, 2002. "Intellectual property rights, strategic technology agreements and market structure: The case of GSM," Research Policy, Elsevier, vol. 31(7), pages 1141-1161, September.
    16. Iacus, Stefano M. & King, Gary & Porro, Giuseppe, 2011. "Multivariate Matching Methods That Are Monotonic Imbalance Bounding," Journal of the American Statistical Association, American Statistical Association, vol. 106(493), pages 345-361.
    17. Anne Layne-Farrar & A. Jorge Padilla, 2011. "Assessing the Link Between Standards and Patents," International Journal of IT Standards and Standardization Research (IJITSR), IGI Global, vol. 9(2), pages 19-49, July.
    18. Kellie J. Archer & Stanley Lemeshow, 2006. "Goodness-of-fit test for a logistic regression model fitted using survey sample data," Stata Journal, StataCorp LP, vol. 6(1), pages 97-105, March.
    19. Tassey, Gregory, 2000. "Standardization in technology-based markets," Research Policy, Elsevier, vol. 29(4-5), pages 587-602, April.
    20. Katz, Michael L & Shapiro, Carl, 1986. "Product Compatibility Choice in a Market with Technological Progress," Oxford Economic Papers, Oxford University Press, vol. 38(0), pages 146-165, Suppl. No.
    21. Vikas A. Aggarwal & David H. Hsu, 2014. "Entrepreneurial Exits and Innovation," Management Science, INFORMS, vol. 60(4), pages 867-887, April.
    22. Josh Lerner & Jean Tirole, 2006. "A Model of Forum Shopping," American Economic Review, American Economic Association, vol. 96(4), pages 1091-1113, September.
    23. Knut Blind, 2002. "Driving forces for standardization at standardization development organizations," Applied Economics, Taylor & Francis Journals, vol. 34(16), pages 1985-1998.
    24. Tineke M. Egyedi, 2003. "Consortium Problem Redefined: Negotiating Democracy in the Actor Network on Standardization," International Journal of IT Standards and Standardization Research (IJITSR), IGI Global, vol. 1(2), pages 22-38, July.
    25. James J. Heckman, 2008. "Causalidad econométrica," Monetaria, CEMLA, vol. 0(3), pages 291-338, julio-sep.
    26. Blind, Knut & Thumm, Nikolaus, 2004. "Interrelation between patenting and standardisation strategies: empirical evidence and policy implications," Research Policy, Elsevier, vol. 33(10), pages 1583-1598, December.
    27. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
    28. Iizuka, Michiko & Ikeda, Yoko, 2021. "Regulation and innovation under the 4th industrial revolution: The case of a healthcare robot, HAL by Cyberdyne," Technovation, Elsevier, vol. 108(C).
    29. Iacus, Stefano & King, Gary & Porro, Giuseppe, 2009. "cem: Software for Coarsened Exact Matching," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 30(i09).
    30. Cesare A. F. Riillo, 2013. "Profiles and Motivations of Standardization Players," International Journal of IT Standards and Standardization Research (IJITSR), IGI Global, vol. 11(2), pages 17-33, July.
    31. Kang, Byeongwoo & Motohashi, Kazuyuki, 2015. "Essential intellectual property rights and inventors’ involvement in standardization," Research Policy, Elsevier, vol. 44(2), pages 483-492.
    32. Paul Wakke & Knut Blind & Florian Ramel, 2016. "The impact of participation within formal standardization on firm performance," Journal of Productivity Analysis, Springer, vol. 45(3), pages 317-330, June.
    33. Lenihan, Helena & McGuirk, Helen & Murphy, Kevin R., 2019. "Driving innovation: Public policy and human capital," Research Policy, Elsevier, vol. 48(9), pages 1-1.
    34. Nambisan, Satish, 2013. "Industry technical committees, technological distance, and innovation performance," Research Policy, Elsevier, vol. 42(4), pages 928-940.
    35. Annika Lorenz & Michael Raven & Knut Blind, 2019. "The role of standardization at the interface of product and process development in biotechnology," The Journal of Technology Transfer, Springer, vol. 44(4), pages 1097-1133, August.
    36. Aija Elina Leiponen, 2008. "Competing Through Cooperation: The Organization of Standard Setting in Wireless Telecommunications," Management Science, INFORMS, vol. 54(11), pages 1904-1919, November.
    37. Tim Büthe & Walter Mattli, 2011. "The New Global Rulers: The Privatization of Regulation in the World Economy," Economics Books, Princeton University Press, edition 1, number 9470.
    38. Paul Wakke & Knut Blind & Henk J. De Vries, 2015. "Driving factors for service providers to participate in standardization: Insights from the Netherlands," Industry and Innovation, Taylor & Francis Journals, vol. 22(4), pages 299-320, May.
    39. Daniel Carpenter & Jacqueline Chattopadhyay & Susan Moffitt & Clayton Nall, 2012. "The Complications of Controlling Agency Time Discretion: FDA Review Deadlines and Postmarket Drug Safety," American Journal of Political Science, John Wiley & Sons, vol. 56(1), pages 98-114, January.
    40. Iacus, Stefano M. & King, Gary & Porro, Giuseppe, 2012. "Causal Inference without Balance Checking: Coarsened Exact Matching," Political Analysis, Cambridge University Press, vol. 20(1), pages 1-24, January.
    41. Graz,Jean-Christophe, 2019. "The Power of Standards," Cambridge Books, Cambridge University Press, number 9781108499866.
    42. David M. Waguespack & Lee Fleming, 2009. "Scanning the Commons? Evidence on the Benefits to Startups Participating in Open Standards Development," Management Science, INFORMS, vol. 55(2), pages 210-223, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Justus Baron & Cher Li & Shukhrat Nasirov, 2019. "Why do R&D-intensive firms participate in standards organizations? The role of patents and product-market position," Discussion Papers 2019-16, University of Nottingham, GEP.
    2. Justus Baron & Jorge Contreras & Martin Husovec & Pierre Larouche, 2019. "Making the Rules: The Governance of Standard Development Organizations and their Policies on Intellectual Property Rights," JRC Research Reports JRC115004, Joint Research Centre.
    3. Blind, Knut & Krieger, Bastian & Pellens, Maikel, 2022. "The interplay between product innovation, publishing, patenting and developing standards," Research Policy, Elsevier, vol. 51(7).
    4. Wen, Wen & Forman, Chris & Jarvenpaa, Sirkka L, 2022. "The effects of technology standards on complementor innovations: Evidence from the IETF," Research Policy, Elsevier, vol. 51(6).
    5. Hussinger, Katrin & Schwiebacher, Franz, 2013. "The value of disclosing IPR to open standard setting organizations," ZEW Discussion Papers 13-060, ZEW - Leibniz Centre for European Economic Research.
    6. Justus Baron & Daniel F. Spulber, 2018. "Technology Standards and Standard Setting Organizations: Introduction to the Searle Center Database," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(3), pages 462-503, September.
    7. Lee, Won Sang & Sohn, So Young, 2018. "Effects of standardization on the evolution of information and communications technology," Technological Forecasting and Social Change, Elsevier, vol. 132(C), pages 308-317.
    8. Blind, Knut & Mangelsdorf, Axel, 2016. "Motives to standardize: Empirical evidence from Germany," Technovation, Elsevier, vol. 48, pages 13-24.
    9. Wiegmann, Paul Moritz & Eggers, Felix & de Vries, Henk J. & Blind, Knut, 2022. "Competing Standard-Setting Organizations: A Choice Experiment," Research Policy, Elsevier, vol. 51(2).
    10. Justus Baron & Kirti Gupta, 2018. "Unpacking 3GPP standards," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(3), pages 433-461, September.
    11. Deng, Xin & Li, Qian Cher & Mateut, Simona, 2022. "Participation in setting technology standards and the implied cost of equity," Research Policy, Elsevier, vol. 51(5).
    12. Wen Wen & Chris Forman & Sirkka Jarvenpaa, 2014. "How Do Open Standards Influence Inventive Activity? Evidence from the IETF," Working Papers 14-20, NET Institute.
    13. Riillo, Cesare Fabio Antonio, 2014. "ICT Standardization and use of ICT standards: a firm level analysis," MPRA Paper 63436, University Library of Munich, Germany.
    14. von Laer, Maximilian & Blind, Knut & Ramel, Florian, 2022. "Standard essential patents and global ICT value chains with a focus on the catching-up of China," Telecommunications Policy, Elsevier, vol. 46(2).
    15. Raven, Michael & Blind, Knut, 2017. "The characteristics and impacts of scientific publications in biotechnology research referenced in standards," Technological Forecasting and Social Change, Elsevier, vol. 115(C), pages 167-179.
    16. Wiegmann, Paul Moritz & de Vries, Henk J. & Blind, Knut, 2017. "Multi-mode standardisation: A critical review and a research agenda," Research Policy, Elsevier, vol. 46(8), pages 1370-1386.
    17. Justus Baron & Tim Pohlmann, 2018. "Mapping standards to patents using declarations of standard‐essential patents," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(3), pages 504-534, September.
    18. Gamarra, Yanis & Friedl, Gunther, 2022. "Firms' Involvement in Standardization and Average Total Costs per Patent Family," 31st European Regional ITS Conference, Gothenburg 2022: Reining in Digital Platforms? Challenging monopolies, promoting competition and developing regulatory regimes 265630, International Telecommunications Society (ITS).
    19. Ramboer, Sander & Reynaerts, Jo, 2020. "Indecent proposals: Estimating the impact of regional state aid through EU guideline compliance," Regional Science and Urban Economics, Elsevier, vol. 82(C).
    20. Nizar Abdelkafi & Sergiy Makhotin & Marina Thuns & Anna Pohle & Knut Blind, 2016. "To Standardise Or To Patent? Development Of A Decision Making Tool And Recommendations For Young Companies," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(08), pages 1-30, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jtecht:v:48:y:2023:i:6:d:10.1007_s10961-022-09951-z. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.