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Do Companies Benefit from Public Research Organizations? The Impact of the Fraunhofer Society in Germany

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  • Comin, Diego

    () (Dartmouth College & CEPR)

  • Licht, Georg

    () (ZEW)

  • Pellens, Maikel

    () (ZEW & KU Leuven)

  • Schubert, Torben

    () (CIRCLE & Fraunhofer ISI)

Abstract

Among available policy levers to boost innovation, investment in applied research organisations has received the least attention. In this paper, we analyze the case of the Fraunhofer Society, the largest public applied research organization in Germany. We analyze whether project interaction with Fraunhofer affect the performance and strategic orientation of firms. To that end, we assemble a unique dataset based on the confidential Fraunhofer-internal project management system and merge it with the German contribution to the Community Innovation Survey (CIS), which contains panel information on firm performance. Using instrumental variables that exploit the scale heteroscedasticity of the independent variable (Lewbel, 2012), we identify the causal effects of Fraunhofer interactions on firm performance and strategies. We find a strong, positive effect of project interaction on turnover and productivity growth. We also provide evidence that a major driver of the positive performance effects is the firms increased share of sales from new products and an increase in the share of workers with tertiary education. More detailed analyses reveal, amongst others that the performance effects become stronger the more often firms interact with Fraunhofer and that interactions aiming at generation of technology have a stronger effect than interactions aiming merely at the implementation of existing technologies.

Suggested Citation

  • Comin, Diego & Licht, Georg & Pellens, Maikel & Schubert, Torben, 2018. "Do Companies Benefit from Public Research Organizations? The Impact of the Fraunhofer Society in Germany," Papers in Innovation Studies 2018/7, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
  • Handle: RePEc:hhs:lucirc:2018_007
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    Cited by:

    1. Bianchi, Francesco & Comin, Diego & Kung, Howard & Kind, Thilo & Matusche, Alexander, 2019. "Slow recoveries through fiscal austerity: New insights in the effects of fiscal austerity," ZEW policy briefs 2/2019, ZEW - Leibniz Centre for European Economic Research.
    2. Krieger, Bastian & Licht, Georg & Pellens, Maikel, 2018. "New perspectives in European innovation policy," ZEW policy briefs 7/2018, ZEW - Leibniz Centre for European Economic Research.
    3. Quentin Plantec & Pascal Le Masson & Benoit Weil, 2019. "The role of participating in user-driven research projects on scholar's academic performances: a model through C-K design theory," Post-Print hal-02165721, HAL.
    4. repec:eee:respol:v:48:y:2019:i:1:p:223-233 is not listed on IDEAS

    More about this item

    Keywords

    Innovation; R&D; diffusion; applied research; Fraunhofer;

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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