The impact of firm participation in R&D programmes on R&D partnerships

R&D subsidies designed to encourage innovation efforts by firms may have intended and unintended effects on the way they organize their innovation process. We present empirical evidence on how R&D subsidies affect firms’ R&D cooperation strategies. In particular, we investigate whether receiving public R&D subsidies affect the probability that a firm will set up an R&D partnership with a public research organization (PRO), or with other firms. Our main findings are: (i) public support significantly increases the chances that a firm will cooperate with a PRO, and (ii) public support also increases the likelihood that a firm will establish private partnerships, but to a smaller extent and only when firms have intangible knowledge assets. These results suggest that public R&D programmes trigger a behavioural change in firms’ R&D partnerships, alleviating barriers to cooperation.     

Factors affecting university-industry R&D projects: The importance of searching, screening and signalling

This paper presents an empirical analysis of the determinants of research cooperation between firms and Public research organisations (PROs) for a sample of innovating small and medium-sized enterprises (SMEs). The econometric analysis is based on the results of the KNOW survey carried out in seven EU countries during 2000. In contrast to earlier works that provide information about the importance of PROs’ research, we know the number of firm/PRO collaborative research and development (R&D) projects. This allows us to study the determinants of firm collaboration with PROs in terms of both the propensity of a firm to undertake R&D projects with a university (do they cooperate or not) and the extent of this collaboration (number of R&D projects). Two questions are addressed. Which firms cooperated with PROs? And what are the firm characteristics that might explain the number of R&D projects with PROs? The results of our analysis point to two major phenomena. First, the propensity to forge an agreement with an academic partner depends on the ‘absolute size’ of the industrial partner. Second the openness of firms to the external environment, as measured by their willingness to search, screen and signal, significantly affects the development of R&D projects with PROs. Our findings suggest that acquiring knowledge through the screening of publications and involvement in public policies positively affects the probability of signing an agreement with a PRO, but not the number of R&D projects developed. In fact, firms that outsource research and development, and patent to protect innovation and to signal competencies show higher levels of collaboration.     

Searching high and low: what types of firms use universities as a source of innovation?

This paper examines the factors that influence why firms draw from universities in their innovative activities. The link between the universities and industrial innovation, and the role of different search strategies in influencing the propensity of firms to use universities is explored. The results suggest that firms who adopt “open” search strategies and invest in R&D are more likely than other firms to draw from universities, indicating that managerial choice matters in shaping the propensity of firms to draw from universities.     

Determinants of R&D cooperation in Japanese start-ups

This paper explores the determinants of R&D cooperation in Japanese start-ups. Using a sample from an original survey conducted in 2008, we examine the effects of founder-, firm-, and industry-specific characteristics on R&D cooperation by type of partners. Our findings indicate that founder-specific characteristics such as educational background, prior innovation output, and affiliation to academic associations are fairly important in determining R&D cooperation with academic institutes (universities and public research institutes). We also provide evidence that founders’ prior innovation output and work experience have positive and significant effects on R&D cooperation with business partners. With respect to firm-specific characteristics, it is found that firms investing more in R&D tend to engage in R&D cooperation, regardless of the type of partners. Furthermore, it is found that independent firms are less likely to cooperate in R&D with academic institutes than subsidiaries and affiliated firms.     

Measuring the change in R&D efficiency of the Japanese pharmaceutical industry

This paper presents a data envelopment analysis (DEA)/Malmquist index methodology for measuring the change in R&D efficiency at both firm and industry levels. Letting each of ten firms in each year be a separate decision-making unit, and employing one input and three outputs in a DEA case of R&D activity input-output lag, we measure “total factor R&D efficiency” change of Japanese pharmaceutical firms for decade 1983-1992 as defined by the period of R&D input. Decomposing Malmquist index into catch-up and frontier shift components and using “cumulative indices” proposed in this study, we evaluate R&D efficiency change for each firm and empirically show that R&D efficiency of Japanese pharmaceutical industry has almost monotonically gotten worse throughout the study decade.     

R&D cooperation and innovation activities of firms—evidence for the German manufacturing industry

The aim of the paper is to investigate in a simultaneous equation framework the role of R&D cooperation in the innovation process—in context with other factors—from two specific aspects. First, analysis focuses on the impact of R&D cooperation on firms’ innovation input and output. Second, analysis is undertaken as to how the number of cooperation partners affects the innovation behaviour of firms. Starting with the discussion of theoretically expected effects of successful R&D cooperation on the innovation activities of firms, the importance of inter-organizational arrangements in R&D is empirically investigated in respect of firms in the German manufacturing industry. The estimation results can be summarized as follows: joint R&D is used to complement internal resources in the innovation process, enhancing the innovation input and output measured by the intensity of in-house R&D or the realization of product innovations. On the input side, the intensity of in-house R&D also stimulates the probability and the number of joint R&D activities with other firms and institutions significantly.     

Managing open innovation projects with science-based and market-based partners

This paper examines the relationship between (outside-in) open innovation and the financial performance of R&D projects, drawing on a unique dataset that contains information on the open innovation practices, management and performance of 489 R&D projects of a large European multinational firm. We introduce two types of open innovation partnerships – science-based and market-based partnerships – and examine their relationships with project financial performance. In addition, we investigate whether the open innovation—project performance relationships are influenced by the way how R&D projects are managed. Our results show that R&D projects with open innovation partnerships are associated with a better financial performance providing that they are managed in the most suitable way. Market-based partnerships are positively correlated with project performance if a formal project management process is used; however these partnerships are associated with a lower performance for loosely managed projects. In contrast, science-based partnerships are associated with higher project revenues for loosely managed projects only.     

Sources of innovation and industry-university interaction: Evidence from Spanish firms

In this paper we use a sample of Spanish innovative firms to identify the determinants of R&D cooperation agreements between five types of partners: firms that belong to the same group; customers and suppliers; competitors; universities; public research centres. We focus on the determinants of R&D cooperation between innovative firms and universities. We used the Spanish version of the Community Innovation Survey (CIS-3) to obtain data about the R&D cooperation of 4150 innovative firms in Spain. To obtain empirical evidence about the determinants of this cooperation, we adopted an integrated approach that enables us to compare the effects of sectorial and individual determinants on the choice of partners. Our results show that a firm's cooperation activities are closely linked to the characteristics of the industry and the characteristics of the firm. These include R&D intensity, size, whether the firm belongs to a group, product and process innovation, and access to public funds for R&D activities. Internal R&D and agreements with customers, suppliers and competitor partners also increase firm's propensity for R&D cooperation with universities.     

How do collaborations with universities affect firms’ innovative performance? The role of “Pasteur scientists” in the advanced materials field

This article aimed to identify the effect of university-industry (U-I) collaborations on the innovative performance of firms operating in the advanced materials field, and by doing so, it proposed an original classification of the research organization partners. The main contribution resides in the estimation of the role played by collaborations with differently experienced scientists. In contrast with previous studies, whose empirical setting was the life science industry, in the advanced materials industry the most effective collaborations are not with “Star scientists”, but with “Pasteur scientists”. The latter concept was empirically tested first by the authors of this article, to deepen the present understanding of industrial heterogeneity in innovation processes and to offer new insights for the formulation of corporate innovation strategies. The results of the estimation of a negative binomial regression model applied to a sample of 455 firms active in the photocatalysis in Japan confirm the idea that engaging in research collaborations, measured as co-invention, with “Pasteur scientists” increases firms’ R&D productivity, measured as number of registered patents. In contrast, we found that firms’ collaborations with “Star scientists” exert little impact on their innovative output.     

Environmental innovation and R&D cooperation: Empirical evidence from Spanish manufacturing firms

This paper explores the relationship between firms’ R&D cooperation strategies and their propensity to introduce environmental innovations.Previous literature has supported that environmental innovations differ from other innovations as far as externalities and drivers of their introduction are concerned, highlighting mainly the importance of regulation to trigger them. Using data from the Community Innovation Survey on Spanish manufacturing firms (PITEC), this paper investigates specificities that affect rather how they are developed, and in particular the higher importance of R&D cooperation with external partners.The econometric estimations, controlling for selection bias, suggest that environmental innovative firms cooperate on innovation with external partners to a higher extent than other innovative firms. Furthermore, cooperation with suppliers, KIBS and universities is more relevant than for other innovators, whereas cooperation with clients does not seem to be differentially important. Finally, the results bespoke of a substitution effect between cooperation activities and the internal R&D effort.     

Organizational and human resource management and innovation: Which management practices are linked to product and/or process innovation?

We examine the determinants of firms’ innovation success, using the firm-level data from the Japanese National Innovation Survey. We focus on the relationship between organizational and human resource management practices for research and development (R&D) and product/process innovation. We find that interdivisional cooperation/teams and the creation/relocation/integration of R&D centers are positively associated with both product and process innovation. Having board members with an R&D background is positively associated with product innovation, implying that top-down R&D decision-making may be important for firms to introduce new products. Among the factors examined, personnel assessment reflecting R&D outcomes appears to have an especially strong relationship with product innovation. Moreover, the positive relationship between the creation/relocation/integration of R&D centers and innovation success suggests that drastic organizational changes can work as a clear signal of firms’ determination to pursue an innovation-oriented strategy and help to accelerate innovation success.     

Do public subsidies stimulate private R&D spending?

The objective of this paper is to contribute to the empirical literature that evaluates the effects of public R&D support on private R&D investment. We apply a matching approach to analyze the effects of public R&D support in Spanish manufacturing firms. We examine whether or not the effects are different depending on the size of the firm and the technological level of the sectors in which the firms operate. We evaluate the effect of R&D subsidies on the subsidized firms, considering both the effect of subsidies on firms that would have performed R&D in the absence of public support and also the effect of inducement to undertake R&D activities. We also analyze the effect that concession of subsidies might have on firms which do not enjoy this type of support. The main conclusions indicate absence of “crowding-out”, either full or partial, between public and private spending and that some firms - mainly small and operating in low technology sectors - might not have engaged in R&D activities in the absence of subsidies.     

How much should society fuel the greed of innovators?: On the relations between appropriability, opportunities and rates of innovation

The paper attempts a critical assessment of both the theory and the empirical evidence on the role of appropriability and in particular of Intellectual Property Rights (IPRs) as incentives for technological innovation. We start with a critical discussion of the standard justification of the attribution of IPR in terms of “market failures” in knowledge generation. Such an approach, we argue, misses important features of technological knowledge and also neglects the importance of non-market institutions in the innovation process. Next, we examine the recent changes in the IPR regimes and their influence upon both rates of patenting and underlying rates of innovation. The evidence broadly suggests that, first, IPRs are not the most important device apt to “profit from innovation”; and second, they have at best no impact, or possibly even a negative impact on the underlying rates of innovation. Rather, we argue, technology- and industry-specific patterns of innovation are primarily driven by the opportunities associated with each technological paradigm. Conversely, firm-specific abilities to seize them and “profit from innovation” depend partly on adequacy of the strategic combinations identified by the taxonomy of [Teece, D., 1986. Profiting from technological innovation: implications for integration, collaboration, licensing and public policy. Research Policy 15, 285-305.] and partly on idiosyncratic capabilities embodied in the various firms.     

Innovation, regional knowledge spillovers and R&D cooperation

We investigate the impact of knowledge spillovers and R&D cooperation on innovation activities in three German regions. We begin by estimating the knowledge-production function in order to test for interregional difference with regard to the efficiency of innovation activities. In a second step, we analyze the contribution of spillovers from R&D effort of other private firms and of public research institutions to explain these differences. The inclusion of variables for R&D cooperation in the model indicates that R&D cooperation is only of relatively minor importance as a medium for knowledge spillover.     

A hidden cost of strategic alliances under Schumpeterian dynamics

Recently, proponents of interfirm R&D collaboration have emphasized its benefits. We develop a dynamic model of Schumpeterian competition to examine whether such collaboration is indeed beneficial in the long run. We find that interfirm R&D collaboration is more likely to be a losing strategy when partners form alliances mainly to reduce R&D costs. On the other hand, partners collaborating to seek synergy by accessing each other's complementary assets/capabilities are more likely to be successful. Our study suggests that firms should not use strategic alliances merely to reduce R&D costs in a catch-up situation or to avoid head-on competition with rivals.     

Complementarities of innovation activities: An empirical analysis of the German manufacturing sector

Innovation strategies in manufacturing often involve internal R&D activities as well as external partnerships. Thereby it is not clear if internal and external activities are complements or substitutes. This paper tests for complementarity of different innovation activities, i.e. internal R&D, R&D contracting, and R&D cooperation. The empirical analysis of cross-sectional firm level data of the German manufacturing sector comprises both indirect and direct complementarity tests; it is based on data from the German part of the Community Innovation Survey (CIS 3). The results provide evidence for significant complementarities between internal R&D and R&D cooperation, but cast doubt on the complementarity of internal and contracted R&D, since a productivity effect on firms’ patenting probability or sales with new products cannot be found.     

R&D support programs in developing countries: The Turkish experience

In this study, the determinants of private R&D investment are examined at the level of firms in the Turkish manufacturing industry. We focus our attention on the effect of public R&D support programs. Our findings indicate that public R&D support significantly and positively affects private R&D investment. There seems to be even an “acceleration effect” on firm-financed R&D expenditures. Smaller R&D performers benefit more from R&D support and perform more R&D. In addition, technology transfer from abroad and domestic R&D activity show up as complementary processes. Given the scarcity of studies on R&D support in technologically weaker economies, our hope is that the less-developed countries can exploit these findings in constructing socially beneficial technology policies.     

Are patents with multiple inventors from different countries a good indicator of international R&D collaboration? The case of ABB

Based on the critical case of ABB, this paper questions the relevance of using patents with multiple inventors from different countries (“cross-country patents”) as an indicator of international R&D collaboration. The study shows that less than half of ABB's cross-country patents are the result of international R&D collaboration as described by one of the more inclusive definitions found in previous literature. Only a third of the patents are the result of joint R&D activities between different MNC subsidiaries or firms. We also discuss the implications of our study for the assignment of patents to countries based on inventor addresses.     

Internal and external discipline: The effect of project leadership and government monitoring on the performance of publicly funded R&D consortia

R&D consortia have been regarded as an effective means of promoting innovation. Several R&D consortia obtain public financial support, which may affect their governance structure and performance. This study investigates the governance mechanisms of publicly funded R&D consortia and their effects on innovation performance. Few studies have empirically addressed the effect of project monitoring by the government or the role of project leadership in R&D consortia. Focusing on a major support program for R&D consortia in Japan and using a sample of 251 firms that participated in publicly funded R&D consortia from 2004 to 2009, we empirically confirm that to enhance firms’ innovation performance, both project leadership as internal discipline and government monitoring as external discipline matter. Our results show that project leadership directly improves firms’ innovation performance, while firms’ commitment indirectly affects performance. Project leadership and government monitoring also promote commitment. Furthermore, both factors are complementary: consortia members are more willing to accept a project leader’s coordination under stricter government monitoring.