Vertical Relations Between Firms and Innovation: An Empirical Investigation of German Firms
The surge in interfirm cooperative agreements can be seen as expressing a way for firms to respond to and to organize market failure, especially in technology markets. The incentives of firms to internalize activities are to avoid the disadvantages, or capitalize on the advantages, of imperfections or disequilibria in external mechanisms of resource allocations. The purpose of this paper is to investigate empirically the occurrence and importance of different modes of vertical relations between innovating firms, suppliers and users, using data from Germany. The analysis is based on a survey conducted by the "Center for European Economic Research" (Mannheim, Germany) among 3122 firms representing 378 different lines of business, mainly in the manufacturing sector. The main results can be summarized as follows: ? 84 % of all innovating firms responded that they have had R&D cooperation agreements with either suppliers or customers or both. This percentage is even higher (99 %) if we consider only those innovating firms that have also had formal R&D departments. The phenomenon of vertical R&D cooperation is therefore widespread among German firms. ? Informal exchange of technical knowledge was perceived as the most important mode of R&D cooperation between innovating firms on one hand and customers and suppliers on the other, followed by formal methods of cooperation such as joint development teams and contractual R&D cooperation. Joint ventures and direct R&D orders to either customers or suppliers were seen as the least important modes of vertical cooperation. ? The occurrence and importance of cooperative agreements between innovating firms, users and input suppliers vary across industries. ? Results of multivariate statistical analysis (correlation, principal components and cluster analysis) suggested that the various modes of R&D cooperation between innovating firms on one hand and customers and suppliers on the other could be reduced to two subgroups: the first one includes formal modes of cooperation, the second one includes only informal exchange of technical knowledge. On this basis patterns of cooperative agreements could be established for firms operating in different industries and for firms using different product and process technologies.
|Date of creation:||1997|
|Date of revision:|
|Contact details of provider:|| Postal: L 7,1; D - 68161 Mannheim|
Web page: http://www.zew.de/
More information through EDIRC
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.:
- Nadiri, M.I., 1993. "Innovations and Technological Spillovers," Working Papers 93-31, C.V. Starr Center for Applied Economics, New York University.
- 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.
- von Hippel, Eric, 1987. "Cooperation between rivals: Informal know-how trading," Research Policy, Elsevier, vol. 16(6), pages 291-302, December.
- Nelson, Richard R, 1986. "Institutions Supporting Technical Advance in Industry," American Economic Review, American Economic Association, vol. 76(2), pages 186-89, May.
- Geroski, P A, 1992. "Vertical Relations between Firms and Industrial Policy," Economic Journal, Royal Economic Society, vol. 102(410), pages 138-47, January.
- Von Hippel, Eric, 1982. "Appropriability of innovation benefit as a predictor of the source of innovation," Research Policy, Elsevier, vol. 11(2), pages 95-115, April.
- Mowery, David C., 1989. "Collaborative ventures between U.S. and foreign manufacturing firms," Research Policy, Elsevier, vol. 18(1), pages 19-32, February.
- 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.
- Harabi, Najib, 1994.
"Appropriability of Technical Innovations: An Empirical Analysis,"
26267, University Library of Munich, Germany.
- Harabi, Najib, 1995. "Appropriability of technical innovations an empirical analysis," Research Policy, Elsevier, vol. 24(6), pages 981-992, November.
- Harabi, N., 1993. "Appropriabiblity of Technical Innovations: An Empirical Analysis," Papers 31a, Universitat Zurich - Wirtschaftswissenschaftliches Institut.
- Steven Tadelis & Oliver E.Williamson, 2012.
"Transaction Cost Economics,"
in: Robert Gibbons & John Roberts (ed.), : The Handbook of Organizational Economics
Princeton University Press.
- Zvi Griliches, 1998.
"The Search for R&D Spillovers,"
in: R&D and Productivity: The Econometric Evidence, pages 251-268
National Bureau of Economic Research, Inc.
- Pisano, Gary P, 1989. "Using Equity Participation to Support Exchange: Evidence from the Biotechnology Industry," Journal of Law, Economics and Organization, Oxford University Press, vol. 5(1), pages 109-26, Spring.
- Schrader, Stephan, 1991. "Informal technology transfer between firms: Cooperation through information trading," Research Policy, Elsevier, vol. 20(2), pages 153-170, April.
- 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.
- 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.
- Freeman, C., 1991. "Networks of innovators: A synthesis of research issues," Research Policy, Elsevier, vol. 20(5), pages 499-514, 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.
- 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.
- 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.
- Jorde, Thomas M & Teece, David J, 1990. "Innovation and Cooperation: Implications for Competition and Antitrust," Journal of Economic Perspectives, American Economic Association, vol. 4(3), pages 75-96, Summer.
- DeBresson, Chris & Amesse, Fernand, 1991. "Networks of innovators :A review and introduction to the issue," Research Policy, Elsevier, vol. 20(5), pages 363-379, October.
- M. Ishaq Nadiri, 1993. "Innovations and Technological Spillovers," NBER Working Papers 4423, National Bureau of Economic Research, Inc.
- Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-96, September.
When requesting a correction, please mention this item's handle: RePEc:zbw:zewdip:5118. 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: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.