The Impact of Vertical R&D Cooperation on Firm Innovation: An Empirical Investigation
The recent surge of interfirm cooperative agreements can be seen to express a way for firms to respond to and organize market failure, especially in technology markets. The incentives for firms to internalize activities are to avoid the disadvantages, or capitalize on the advantages, of imperfections or disequilibria in external mechanisms of resource allocation. The purpose of this paper is to investigate empirically, on the basis of data from German firms, the impact of vertical R&D cooperation on innovation in firms. The analysis is based on a survey conducted by the "Center for European Economic Research" (Zentrum fur Europaische Wirtschafts-forschung, ZEW) in Mannheim among 370 companies, mainly in the manufacturing sector. The results of the econometric analysis suggest a statistically significant impact of vertical R&D cooperation on the intensity of R&D activity in German firms. Informal modes of R&D cooperation (informal exchange of technological knowledge) seem to be more important for their innovative behavior than formal ones (joint ventures, joint development teams etc.). Since the relationship between vertical R&D cooperation and the intensity of R&D activity in innovating firms has been tested in a broader theoretical and empirical framework, the empirical results also confirm the significance of other key determinants of innovative activity, such as "technological opportunities", "appro-priability conditions" and "market demand".
Volume (Year): 11 (2002)
Issue (Month): 2 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/GEIN20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/GEIN20|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Cohen, Wesley M & Levin, Richard C & Mowery, David C, 1987. "Firm Size and R&D Intensity: A Re-examination," Journal of Industrial Economics, Wiley Blackwell, vol. 35(4), pages 543-65, June.
- Geroski, P A, 1992. "Vertical Relations between Firms and Industrial Policy," Economic Journal, Royal Economic Society, vol. 102(410), pages 138-47, January.
- Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
- Pisano, Gary P., 1991. "The governance of innovation: Vertical integration and collaborative arrangements in the biotechnology industry," Research Policy, Elsevier, vol. 20(3), pages 237-249, June.
- Harhoff, Dietmar, 1997. "Innovationsanreize in einem strukturellen Oligopolmodell," ZEW Discussion Papers 97-16, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Klevorick, Alvin K. & Levin, Richard C. & Nelson, Richard R. & Winter, Sidney G., 1995.
"On the sources and significance of interindustry differences in technological opportunities,"
Elsevier, vol. 24(2), pages 185-205, March.
- Alvin K. Klevorick & Richard C. Levin & Richard R. Nelson & Sidney G. Winter, 1993. "On the Sources and Significance of Interindustry Differences in Technological Opportunities," Cowles Foundation Discussion Papers 1052, Cowles Foundation for Research in Economics, Yale University.
- Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
- Monteverde, Kirk & Teece, David J, 1982. "Appropriable Rents and Quasi-Vertical Integration," Journal of Law and Economics, University of Chicago Press, vol. 25(2), pages 321-28, October.
- Dasgupta, Partha & Stiglitz, Joseph, 1980. "Industrial Structure and the Nature of Innovative Activity," Economic Journal, Royal Economic Society, vol. 90(358), pages 266-93, June.
- Najib Harabi, 1998. "Innovation Through Vertical Relations Between Firms, Suppliers And Customers: A Study Of German Firms," Industry and Innovation, Taylor & Francis Journals, vol. 5(2), pages 157-179.
- Wesley M. Cohen & Richard C. Levin & David C. Mowery, 1987. "Firm Size and R&D Intensity: A Re-Examination," NBER Working Papers 2205, National Bureau of Economic Research, Inc.
- Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September.
- Geroski, P A & Walters, C F, 1995. "Innovative Activity over the Business Cycle," Economic Journal, Royal Economic Society, vol. 105(431), pages 916-28, July.
- von Hippel, Eric, 1976. "The dominant role of users in the scientific instrument innovation process," Research Policy, Elsevier, vol. 5(3), pages 212-239, July.
- Geroski, P A, 1993. "Antitrust Policy towards Co-operative R&D Ventures," Oxford Review of Economic Policy, Oxford University Press, vol. 9(2), pages 58-71, Summer.
- Kleinknecht, Alfred & Reijnen, Jeroen O. N., 1992. "Why do firms cooperate on R&D? an empirical study," Research Policy, Elsevier, vol. 21(4), pages 347-360, August.
- Harabi, Najib, 1995.
"Appropriability of technical innovations an empirical analysis,"
Elsevier, vol. 24(6), pages 981-992, November.
- Harabi, N., 1993. "Appropriabiblity of Technical Innovations: An Empirical Analysis," Papers 31a, Universitat Zurich - Wirtschaftswissenschaftliches Institut.
- Harabi, Najib, 1994. "Appropriability of Technical Innovations: An Empirical Analysis," MPRA Paper 26267, University Library of Munich, Germany.
- Dietmar Harhoff, 1996. "Strategic Spillovers and Incentives for Research and Development," Management Science, INFORMS, vol. 42(6), pages 907-925, June.
- Cohen, Wesley M. & Levin, Richard C., 1989. "Empirical studies of innovation and market structure," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 18, pages 1059-1107 Elsevier.
- Richard C. Levin & Alvin K. Klevorick & Richard R. Nelson & Sidney G. Winter, 1988. "Appropriating the Returns from Industrial R&D," Cowles Foundation Discussion Papers 862, Cowles Foundation for Research in Economics, Yale University.
- Richard C. Levin & Alvin K. Klevorick & Richard R. Nelson & Sidney G. Winter, 1987. "Appropriating the Returns from Industrial Research and Development," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 18(3), pages 783-832.
- Hirshleifer, Jack, 1971. "The Private and Social Value of Information and the Reward to Inventive Activity," American Economic Review, American Economic Association, vol. 61(4), pages 561-74, September.
- Najib Harabi, 1995. "Sources Of Technical Progress: Empirical Evidence From Swiss Industry," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 4(1), pages 67-76.
When requesting a correction, please mention this item's handle: RePEc:taf:ecinnt:v:11:y:2002:i:2:p:93-108. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.