Understanding productivity dynamics: A task taxonomy approach

As job markets have been polarizing, firms have been changing their labor inputs. By using matched employer–employee data for Portugal, we examine whether labor market polarization has occurred within or across firms and how labor input upgrades have contributed to overall productivity growth. We develop a firm taxonomy based on worker's occupational data. Firms can be focused on one task – Abstract, Manual or Routine – on a combination of tasks, or none. Results show that Abstract firms are the most productive and their share has increased over time. Manual firms, the least productive, have had a stable share throughout the period. Routine firms have seen their share decline over time. The dynamic decomposition of the estimated productivity reveals that productivity growth is propelled by increased market shares of the most productive incumbents and exiting of the least productive, especially for Abstract firms. Notwithstanding these productivity growth drivers, they fail to avert the productivity stagnation observed in Portugal between 2004 and 2009 due to the overall decline in productivity of incumbent firms, especially Routine. We discuss the policy implications of our results which are relevant to other European economies also lagging behind in terms of knowledge and innovation capabilities.     

International scientist mobility and the locus of knowledge and technology transfer

Despite the growing interest of scholars and policymakers to better understand the determinants for researchers in public science to transfer knowledge and technology to firms, little is known how temporary international mobility of scientists affects both their propensity to engage in knowledge and technology transfer (KTT) as well as the locus of such transfer. Based on a sample of more than 950 German academics from science and engineering faculties, we investigate how the duration and the frequency of scientists’ visits at research institutions outside their home country affect KTT activities. We find that most mobile scientists engage in KTT to firms both in the host and in their home country, suggesting that KTT activities to firms abroad do not substitute or crowd out, but complement KTT to firms in the home country. We further find that the longer research visits abroad are, the higher the likelihood that scientists engage in KTT to firms, again both in the host and the home country. However, the more frequently scientists visit institutions abroad, the more likely they are to engage in KTT to firms only in their home country. Our results therefore provide evidence for the benefits of “brain circulation”. The article contributes to the growing strand of the literature on scientist mobility and on the determinants of industry-science linkages at the individual level.     

Assessing the impact of organizational practices on the relative productivity of university technology transfer offices: an exploratory study

We present quantitative and qualitative evidence on the relative productivity of university technology transfer offices (TTOs). Our empirical results suggest that TTO activity is characterized by constant returns to scale and that environmental and institutional factors explain some of the variation in performance. Productivity may also depend on organizational practices. Unfortunately, there are no quantitative measures available on such practices, so we rely on inductive, qualitative methods to identify them. Based on 55 interviews of 98 entrepreneurs, scientists, and administrators at five research universities, we conclude that the most critical organizational factors are faculty reward systems, TTO staffing/compensation practices, and cultural barriers between universities and firms.     

Contractual governance and the choice of dispute-resolution mechanisms: Evidence on technology licensing

In fast-paced and knowledge-intensive environments, licensing partnerships can be powerful levers for market expansion. Research on the management of technology-oriented licenses has nonetheless pointed out the risks of corrosive disputes caused by conflicting interests or misunderstandings among licensing partners. The choice made ex ante on mechanisms for resolving potential disputes is of prime importance in the execution of licensing exchanges. Although the legal literature has widely emphasized the advantages of arbitration towards litigation, public ordering remains the “default” option in managers’ eyes. By adopting a transaction cost economics logic, our study explores the conditions under which licensing partners may prefer arbitration over public ordering during the contractual-design phase. In accordance with our theoretical arguments, findings show that the occurrence of arbitration provisions increases when the coordination orientation adopted by licensing partners is extensive. In situations where both monitoring and coordination orientations are simultaneously extensive, results reveal a greater propensity to prefer arbitration over public ordering. Our research therefore supports the view that corporate decision-makers tend to favor the conciliatory stance and compromising awards typically associated with arbitration, only when exchanges are expected to be highly coordinative. Their preference for arbitration over litigation is magnified when the coordination orientation develops alongside the monitoring orientation.     

Joint ventures and technology adoption: A Chinese industrial policy that backfired

To spur technology transfer, emerging market policymakers often require foreign firms to form joint ventures (JVs) with domestic firms. Through knowledge spillovers, JVs may reduce technology acquisition costs for domestic firms. Yet domestic firm rents from JVs could discourage innovation through a cannibalization effect. Which force dominates is an empirical question. I address it with novel data on China's auto sector. In response to fuel economy standards requiring firms to upgrade technology or sacrifice quality, firms with JVs reduced quality and price relative to their counterparts. Consistent with cannibalization, firms with JVs drive the negative effect.     

On research efficiency: A micro-analysis of Dutch university research in Economics and Business Management

We argue that efficiency assessments of academic research should focus on micro-units of research production rather than on conventionally employed (aggregated) macro-units, and show that such a detailed analysis of research performance provides interesting insights. In addition, we propose a non-parametric methodology that is specially tailored for analyzing the productive efficiency of research: it starts from a specification of the managerial objectives of research activities while imposing minimal structure on the (typically unknown) production technology. We illustrate our points by assessing the productive efficiency of research in Economics and Business Management Faculties of Dutch universities. Next to measuring productive efficiency, we look for specific patterns in efficiency distributions over universities, years and areas of specialization. In addition, we investigate the impact of external funding and the size of research programs on academic research efficiency. We argue that our analysis has some interesting policy implications. Most notably, our results show that a micro-analysis of research efficiency may yield a more effective allocation of the limited financial resources that are available.     

University-industry collaborations in Japan: The role of new technology-based firms in transforming the National Innovation System

This paper examines the role of new technology-based firms in university/industry collaborative (UIC) activities in Japan. UIC activities have been widely diffused into small startup firms over the past 5 years, according to quantitative analysis of RIETIs UIC Survey. In this paper, it is found that these smaller firms achieve higher productivity through UICs than large firms. In light of the findings of this paper, it appears that UICs are gaining momentum and are likely to play a strong role in reducing the dependence of Japan's system of innovation on in-house R&D conducted within large corporations.     

Policy entrepreneurship in the co-evolution of institutions, preferences, and technology: Comparing the diffusion of totally chlorine free pulp bleaching technologies in the US and Sweden

This paper uses the concept of policy entrepreneurship to explain the social processes underlying sustainable technical change in the pulp and paper industry in the 1990s. It presents a detailed case study on the differences in the transition to and diffusion of totally chlorine free (TCF) pulp bleaching methods in Sweden and the USA. This change was sustained in the former, while it was almost absent in the latter. The paper studies the causes for this difference. It looks at the complex coevolution of technology, institutions, and consumer preferences that has taken place in both countries and draws conclusions on how transitions to sustainable paths in production and consumption may be supported by economic and social policy.     

Performance of Spanish universities in technology transfer: An empirical analysis

This paper investigates the performance of universities in the transfer of technology using a unique university-level dataset for Spain. The results suggest that universities with established policies and procedures for the management of technology transfer perform better. Universities with large and experienced technology transfer offices (TTOs) generate higher volumes of contract research, but the TTO characteristics appear to matter less for university performance in terms of licensing and creation of spin-offs. Furthermore, universities with a science park perform better than those without, which suggests that the agglomeration of knowledge close to universities has a positive effect on universities’ technology transfer performance.     

Multinationality, foreignness and institutional distance in the relation between R&D and productivity

This paper empirically examines to what extent being foreign and part of a multinational affects the endogenous relation between R&D and productivity. Our findings indicate that multinationals obtain in general higher R&D returns. Also, there is a negative foreignness effect in that domestic-owned multinationals outperform foreign subsidiaries. However, these effects are somehow moderated by the institutional distance between the home and host countries. These results, obtained for a panel of UK firms, are largely consistent with a set of hypotheses derived from the institutional and international business theories.     

Human capital and innovation: the importance of the optimal organizational task structure

Management literature has identified high-skilled human capital as a crucial dimension of innovation processes at the firm level. In this study, we introduce an alternative view of human capital based on the tasks that firms’ workers perform. We propose a measure of cognitive analytical and interpersonal tasks: the degree of abstractism. We argue that the level of abstractism of a firm has an effect on a firm's propensity to innovate and on its product innovation performance. We hypothesize that while the degree of abstractism has a linear positive relationship with the propensity to innovate, the relationship between abstractism and product innovation performance follows an inverted u-shaped relationship. We find partial support to our hypotheses using data from more than six thousand Portuguese firms. We discuss how these results change our understanding of the relationship between human capital and innovation at the firm level.     

Pre-empted patents,infringed patents and firms’ participation in markets for technology

In recent years, firms have increasingly contributed to and been confronted with a patent landscape characterized by numerous but marginal inventions, overlapping claims and patent fences. As a result, firms risk their patent applications to be pre-empted or to be infringed upon by rivals. While both aspects constitute major challenges for the appropriation of returns to inventive activity, extant literature suggests that participation in the market for technology might actually resolve or at least alleviate these problems. In this paper, we investigate the effect of pre-empted and infringed patents on firms’ engagement in in- and cross-licensing. Based on a sample of more than 1100 German manufacturing firms our results show that firms engage in in-licensing as a reaction to pre-empted patents and in cross-licensing if their protected IP was infringed upon. However, these effects vary depending on the fragmentation of technology fields and whether the firm operates in a discrete or complex product industry.     

Entrepreneurial orientation, technology transfer and spinoff performance of U.S. universities

This paper adopts a resource-based perspective to understand why some universities are more successful than others at generating technology-based spinoff companies. In this respect, we derive eight hypotheses that link attributes of resources and capabilities, institutional, financial, commercial and human capital, to university spinoff outcomes. Using panel data from 1980 to 2001, our econometric estimators reveal evidence of history dependence for successful technology transfer to occur although faculty quality, size and orientation of science and engineering funding and commercial capability were also found to be predictors of university spinoff activity. We conclude by drawing implications for policy makers and university heads.     

Founders’ human capital and the growth of new technology-based firms: A competence-based view

In this paper, we analyze empirically the relation between the growth of new technology-based firms and the human capital of founders, with the aim of teasing out the “wealth” and “capability” effects of human capital. For this purpose, we take advantage of a new data set relating to a sample composed of 506 Italian young firms that operate in high-tech industries in both manufacturing and services. In accordance with competence-based theories, the econometric estimates show that the nature of the education and of the prior work experience of founders exerts a key influence on growth. In fact, founders’ years of university education in economic and managerial fields and to a lesser extent in scientific and technical fields positively affect growth while education in other fields does not. Similarly prior work experience in the same industry of the new firm is positively associated with growth while prior work experience in other industries is not. Furthermore, it is the technical work experience of founders as opposed to their commercial work experience that determines growth. The fact that within the founding team there are individuals with prior entrepreneurial experiences also results in superior growth. Lastly, we provide evidence that there are synergistic gains from the combination of the complementary capabilities of founders relating to (i) economic-managerial and scientific-technical education and (ii) technical and commercial industry-specific work experiences. We conclude that the human capital of founders of new technology-based firms is not just a proxy for personal wealth.     

Manufacturing dynamics and spillovers: The case of Guangdong Province and Hong Kong, Macau, and Taiwan (HKMT)

In this paper we characterize the extent of economic integration between Guangdong, Hong Kong, Macau, and Taiwan (HKMT). We do not find, for the period of 1999-2003, consistent evidence that economic activity on the part of HKMT-funded companies contributed to productivity growth in Guangdong domestic manufacturing firms. Furthermore, HKMT-funded companies were less active than Guangdong domestic companies in pursuing research and development (R&D) and innovation activities. Given that HKMT-funded companies in Guangdong are dominated by companies from Hong Kong, we end by linking our results to a discussion of recent innovation policy actions, both in Hong Kong SAR and Guangdong province.     

Innovation in the service sector: The demand for service-specific innovation measurement concepts and typologies

There is evidence that the notion of innovation, well established in the manufacturing sector, cannot simply be transposed to the service sector. This article deals critically with existing measurement concepts derived from manufacturing, and introduces a new typology with a view to obtaining a better understanding of innovation in services. Selected results from the German innovation survey are analysed in order to support the conceptual findings and to identify potential improvements. Special attention is directed towards the inclusion of knowledge-intensive business services that are of particular importance for innovation processes.     

Inter- and intra-firm effects in the diffusion of new process technology

Using primarily the example of Computerised Numerically Controlled Machine Tools (CNC) in the UK metalworking and engineering industry, it is shown that, even many years after the date of first use of a new technology, although the larger proportion of firms may be using that technology, because the extent of intra-firm diffusion is limited, the proportion of total industry output produced on that technology may be quite small. Using backward projection techniques it is further shown that intra-firm diffusion tends to lag behind inter-firm diffusion over the whole of the diffusion process and inter-firm diffusion patterns and extent may thus be poor indicators of overall diffusion. Although intra-firm diffusion is therefore crucial to the understanding of overall diffusion patterns the existing literature relating to it has severe limitations and there are no associated policy results. It is argued that much greater emphasis should be placed on intra-firm issues in future diffusion research. It is also suggested that discussions of intra-firm policy could usefully proceed within the context of already established general diffusion policy principles.     

Absorptive capacity and the search for innovation

This paper examines the link between a firm's absorptive capacity-building activities and the search process for innovation. We propose that the enhanced access to university research enjoyed by firms that engage in basic research and collaborate with university scientists leads to superior search for new inventions and provides advantage in terms of both the timing and quality of search outcomes. Results based on a panel data of pharmaceutical and biotechnology firms support these contentions and suggest that the two research activities are mutually beneficial, but also uncover intriguing differences that suggest differing roles of internally and externally developed knowledge.     

Survivor: The role of innovation in firms’ survival

This paper explores the relationship between innovation and the survival probability of manufacturing firms in the Netherlands, conditional on firm age and size. The empirical analysis combines firm level data on innovation, derived from the second Community Innovation Survey, and on the date of exit, from the Business Register of all firms active in the Netherlands. To estimate the survival probability of a firm we use a non-parametric approach, based on the calculation of Transition Probability Matrices over different time periods. The results show that innovation has a positive and significant effect on the probability of firms’ survival. This effect increases over time and is conditional on firm age and size; we observe that small and young firms are the most exposed to the risk of exit, as found in earlier studies, but also those that most benefit of innovation to survive in the market, especially in the longer term.