2017 Working Paper Series on Corporate R&D and Innovation 2017 Working Paper Series on Corporate R&D and Innovation

Sources of Knowledge Used by Entrepreneurial Firms in the European High-Tech Sector

Authors: Sara Amoroso, David B. Audretsch, and Albert N. Link
No. 03/2017

The purpose of this paper is to explore the relationship between an entrepreneur's experience and education and his/her reliance on alternative sources of knowledge for exploring new business opportunities. The extant literature that is at the crossroads between sources of knowledge and the experiential and intellectual base of an entrepreneur (i.e., dimensions of his/her human capital) suggests that it is through experience and through education that an entrepreneur obtains knowledge. Using information on a sample of high-tech manufacturing firms across 10 European countries, we explore heterogeneities in the influence of experience, age, and education of the firm's primary founder on the perceived importance of (i.e., use of) alternative sources of knowledge. We find that the association of these characteristics differs significantly across sources of knowledge, and across European regions. Education is positively related to the importance of knowledge from research institutes and internal know-how, while age is negatively related to the importance of research institutes and positively related to publications and conferences. On the one hand, in South/East European countries, the importance of internal know-how is positively associated with age and education, but negatively associated with experience. On the other hand, the characteristics of primary founders of North/West European firms are more linked to the importance of the participation to funded research programmes. This source of knowledge is related positively with age and education and negatively with experience

The short-run effect of Knowledge intensive greenfield FDI on new domestic entry

Authors: Sara Amoroso and Bettina Müller
No. 02/2017

Existing evidence on the impact of foreign direct investment on domestic economies remains ambiguous. Positive technology spillovers of foreign investment may be outweighed by negative crowding out effect due to increased competition. In this paper, we employ a unique country/sector-level data set to investigate the impact of what is considered the ‘best' type of foreign investment —greenfield knowledge intensive FDI— on domestic entry. Our results suggest that, in the short run, this type of FDI is positively related to the entry rate in the host country, if the domestic sector is either dynamic, or highly R&D intensive. These sectors may be respectively characterized by lower entry costs, which encourage a ‘trial-and-error' learning business approach, and by a higher level of absorptive capacity which increases the chance of technology transfer.

Design, innovation and performance in European firms

Authors: Sandro Montresor and Antonio Vezzani
No. 01/2017

This paper provides some new theoretical speculations and empirical evidence on the relationship between design, innovation and economic performance at the firm level. We posit that design investments may provide firms with a higher capacity of introducing product/process innovations, but that the ensuing economic performance is rather associated to the role of design within the firm. Moreover, once controlled for the firm's non-technological innovativeness and other knowledge-production inputs, the role of design does also relate to the introduction of innovative products and/or processes. We provide a systematic empirical test for these arguments on a sample of more than 12,000 European firms from the last EC Innobarometer survey. The econometric estimates are consistent with our expectations. However, while a higher innovativeness is also associated with a non-systematic resort to design, a higher innovation-based performance is coupled with an increasingly more central role of design, providing this is at least non-occasional. Innovations do actually look "design-led" overall, but innovating successfully apparently requires the firm to retain such a driver central to its business model.