Innovation, Integration and Product Proliferation - Empirical Evidence for the Agri-Food Industry
While mergers, both horizontal and vertical, have been shaping the landscape of the agri-food industry in Europe, the implications of the changing market structure on the level of innovation has not been studied yet. In this paper we deal with the link between innovation and market structure using the empirical example of the Danish agri-food industry. The purpose of this paper is two-fold. First we test for the importance of vertical integration on innovation. While there exist several studies on this linkage, to our knowledge, this is the first that deals with the agri-food industry. Secondly, we examine both product proliferation and innovation. To our knowledge, there are no other similar studies that examine both aspects using the same data set. We follow the hypothesis put forward by Armour and Teece (1980) that vertical integration enhances technological innovation, mainly because vertical integration may resolve hold-up problems. Our paper is related also to recent work by Weiss and Witkopp (2005) on the German food industry, although their work is mostly related to the role of the retail sector. We are able to examine both innovation (measured as investment on R&D) as well as product proliferation (measured as number of new products). We also examine the effects of network relationships and the importance of countervailing power. We use data from an extensive survey of 444 Danish firms over two years, 2000 and 2005 to estimate two different models: a bootstrapped zero-inflated Poisson regression and a robust Heckman sample selection model. The results verify the hypotheses formulated for both models with various degrees of significance.
|Date of creation:||2008|
|Contact details of provider:|| Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202|
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ags:aaea08:6074. 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: (AgEcon Search)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.