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Spillovers of Innovation Activities and Their Profitability

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  • Czarnitzki, Dirk
  • Kraft, Kornelius

Abstract

Knowledge spillovers to competitors are regarded as an important aspect of the innovation process. While a company possibly benefits from incoming information on successful R&D conducted by other companies, a generally high probability of leakage of knowledge in an industry will negatively affect profitability. This paper presents the results of an empirical study on the effects of outgoing and incoming spillovers on firms? profitability. It turns out that the expected asymmetry is actually at work. In contrast to spillovers from competitors, spillovers from suppliers, customers and research institutions exert no effect.

Suggested Citation

  • Czarnitzki, Dirk & Kraft, Kornelius, 2007. "Spillovers of Innovation Activities and Their Profitability," ZEW Discussion Papers 07-073, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:6893
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    More about this item

    Keywords

    Innovation; Spillover; Profitability;
    All these keywords.

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies

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