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R&D, Firm Size, and Product Innovation Dynamics

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  • Marco Corsino
  • Giuseppe Espa
  • Rocco Micciolo

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Abstract

This paper addresses a debated issue in the economics innovation literature, namely the existence of increasing return to R&D expenditures and sirm size on innovation output. It further explores how structural characteristics of the sirm as well as contextual factors affect the dynamics of product innovation over a relatively long period of time. Taking advantage of an original and unique database comprising innovation data recorded on a monthly base we show that: (i) a negative binomial distribution model is able to predict with great accuracy the probability of having a given number of product announcement sent out in a month; (ii) constant returns to size and R&D expenditure may reasonably characterize the innovation production function of sampled sirms; (iii) vertically integrated manufacturers as well as producers operating a larger product portfolio exhibit a higher propensity to introduce new products than their specialized competitors.

Suggested Citation

  • Marco Corsino & Giuseppe Espa & Rocco Micciolo, 2008. "R&D, Firm Size, and Product Innovation Dynamics," ROCK Working Papers 045, Department of Computer and Management Sciences, University of Trento, Italy, revised 12 Jun 2008.
  • Handle: RePEc:trt:rockwp:045
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    Cited by:

    1. Alsharkas Zeina, 2014. "Firm Size, Competition, Financing and Innovation," International Journal of Management and Economics, De Gruyter Open, vol. 44(1), pages 51-73, December.

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