Publications
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Industrial R&D continued to grow substantially in 2017
R&D funded by the business sector increased in the EU by 5.6%, below the 6.1% global rate and the US… Show more R&D growth (7.2%). The worldwide growth of industrial R&D in 2017 is slightly higher than that recorded in 2016. This growth is largely driven by ICT and health industries. As in previous years, the industrial R&D growth in the EU is led by Germany, with France showing a stronger R&D increase compared to the previous year. In the EU, R&D inflows and outflows for Health industries were nearly equivalent in 2017 (€9.6bn versus €9.4bn) and showed a significant positive trend with respect to 2016. Show less
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PDF Global Innovation Networks: State of the art and issues at stake for GVCs
The objective of the study on "Literature review on Global Innovation Networks: State of the art and issues at stake… Show more for GVC" is to summarise the state of the art literature on Global Innovation Networks (GINs) in order to understand the patterns and evolution of these networks. Based on the review of the literature the study develops a conceptual framework on the relationship between GINs and global value chains (GVCs). The framework systematises the main commonalities and differences between GINs and GVCs and makes suggestions for further evidence collection to address the links between GINs and GVCs. Show less
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"Towards evidence-based industrial research and innovation policy"; Oxford Academic. Science and Public Policy, Volume 45, Issue 2, 1 April 2018, Pages 143–150
Calls for better use of scientific evidence to inform policy decisions stem from the belief that enhanced outcomes for the… Show more society can be expected. Yet, the introduction of evidence-based practices in innovation policymaking has not come without criticism. This introductory article sets the scene for the short collection of papers that address specific issues regarding the prospect of better evidence-based policy in the area of industrial research and innovation (IRI). It identifies and discusses key challenges for the transition towards evidence-based IRI policy. It then introduces the three papers, which build upon and depart from related assumptions or narratives reflecting the current state of practices in IRI policy. Show less
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Explaining Growth Differences across Firms: The Interplay between Innovation and Management Practices
This paper provides first empirical evidence of the joint effects that innovation strategies and human resource management practices exert on… Show more firm growth. By exploiting unique information from a large sample of Italian manufacturing companies in the very recent years, it shows that investing in technology and implementing performance-based pay policies are both positively associated with a significant turnover, employment and labor productivity growth premium. However, their joint adoption does not necessarily sum the two effects. In particular, performance-based rewards boost growth of non-innovators and of firms pursuing relatively simple innovation strategies, centered around the acquisition of embodied technology. For firms strongly relying on R&D as an additional lever for product and process upgrading, the estimated effect of having in place monetary incentive mechanisms is null or even negative. Show less
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From R&D to market: using trademarks to capture the market capability of top R&D investors
This paper investigates the links between the market capability of top corporate R&D investors (EU Industrial R&D Investment Scoreboards), as… Show more captured by trademark data and their economic performance in terms of net sales growth. It provides empirical evidence to better understand the extent to which companies, operating in different industrial sectors, combine technological capabilities with commercialization efforts to generate and appropriate the economic returns of their R&D investments. This paper shows how different dimensions of firms' market capabilities can be captured through trademark indicators. The results suggest that complementing R&D efforts and patenting activities with strong and specific market capabilities can indeed yield significant growth premiums. Moreover, offering services seems to pay off depending on the intensity of R&D investments. Yet, a quantile regression approach and a series of robustness checks indicate that such effects differ across the quantiles of the conditional sales growth distribution. Show less
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Inward greenfield FDI and patterns of job polarization
The unprecedented growth in FDI in the last decades has caused drastic changes in the labour markets of the host… Show more countries. The major part of FDI takes place in low tech industries, where the wages and skills are low, or in high tech, where they offer a wage premium for the highly skilled workers. This mechanism may increase the polarization of employment into high-wage and low-wage jobs, at the expenses of middle-skill jobs. This paper looks at the effects of two types of FDI inflows, namely foreign investment in high-skill and low-skill activities, on skill polarization. We match data on greenfield FDI aggregated by country and sector with data on employment by occupational skill to investigate the extent to which differ types of greenfield FDI are responsible for skill polarization. Show less
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PDF The 2018 EU Survey on Industrial R&D Investment Trends
The 142 EU companies participating in the EU Survey on Industrial R&D Investment Trends expect R&D investment to increase by… Show more 5.4% per annum in 2018 and 2019. This is higher than last year's expectation (4.7%) and indeed the highest expected increase since the pre-crisis years (2007). Companies in the ‘ICT Producers' and ‘Automobile and Other Transport' sector groups expect their R&D to increase the most. These top EU R&D performers expect their R&D within the EU to increase by 4.5% p.a., while their R&D in China and India is expected to show double digit growth (+21.3% and +11.2% respectively). The proportion of R&D investment by EU firms within the EU shows a stable trend since 2006 (at around three-quarters), not showing signs of erosion or offshoring to other regions. In absolute terms, R&D investment levels are higher than ever in the EU. EU firms are increasingly becoming truly global in their R&D activities. In the 2006 survey, only about 15% of EU firms performed R&D in the main world regions. This figure has been constantly increasing, now representing 33% of all participating firms. This confirms both the increasingly global character of R&D and the growing need for top R&D investors to be present in the main R&D locations around the world. China is expected to become the third largest region for the location of R&D activities by EU firms by 2019, after the EU and the US. The proportion of R&D investment by EU firms performed in China is expected to grow to 3.4% in 2019 (from 2.6% in 2017). Since the start of the survey, the third largest region has been the Rest of the World. However, China and India show consistently high growth expectations in all editions of the survey, indicating interesting developments in these countries that are attracting the attention of the EU's main R&D performers. As in all previous surveys, low labour costs for researchers prove not to be an important factor of attractiveness in locating R&D activities. However, there is an important caveat to this finding: firms performing R&D in China or India rate low labour costs as much more important than firms without R&D activities in these countries. Also, companies that perform R&D in many countries rate this factor as much more important than firms performing R&D in only one or a few countries. India is gaining strength as a popular R&D location and is currently second after the US. Firms that perform R&D only in the EU rate the proximity to other activities within the company and the quality of public research as highly important for their location of R&D activities. Firms with R&D activities in the US rate the proximity to suppliers and access to specialised R&D knowledge much higher than firms without R&D activities in the US. The quality of researchers is a factor that is rated consistently highly by firms with R&D activities in the EU only, or that focus on either the US or on China or India, which implies that frontier research is geographically dispersed to all regions. The most highly rated factors for locating production by EU only firms are macroeconomic stability, access to its production infrastructure and quality of personnel. Overall, the factors most often rated as (highly) attractive by firms are access to markets, quality and availability of personnel and macroeconomic stability. Low labour costs are perceived as much more important by firms that produce in China or India than firms that do not. China, Brazil, Italy and Russia remain the countries more frequently mentioned as a production location, as in last year's survey. Access to markets is an important factor for locating production activities in China or India, but not R&D. The average non-R&D expenditure of the respondents is €54 million: 29% of their R&D expenditure or a non-R&D intensity (non-R&D expenditure over net sales) of 0.5%. Firms invest mainly in applied research activities, rather than basic research. This finding is consistent over many editions of the survey and suggests that the European Innovation system has to rely on other actors (i.e. universities and public research institutes, but also start-ups and disruptive companies) for investment in basic research. The main motivation for firms to allow their employees to publish articles in scientific journals is to build the firm's reputation. This helps them to send out a message to two types of audience: venture capital funds (that may be interested in investing in a firm where relevant scientific work is produced) and other talented scientists (who may be interested in working in a scientifically stimulating environment). However, strong differences emerge when comparing firms with high publishing output to those with low output. Companies do not specifically ask for less regulation, but ask for it to be simplified. When asked what public policies should be implemented to boost private R&D and innovation activities, firms call on public authorities to complement their own action through funding research projects and increasing public-private cooperation. Show less
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Heterogeneity of technology-specific R&D investments. Evidence from top R&D investors worldwide
In this work, we develop and apply a methodology to estimate technology-specific R&D investments at firm level. To do so,… Show more we combine R&D investment with patent data from the world top R&D investors worldwide and show that investment per patent varies greatly across technologies and across firms developing a given technology. We then use these results to assess the relationship between technology-specific R&D investments and a series of factors characterizing technological development. The estimation strategy makes use of a multilevel framework that allows modelling heterogeneity at the firm and sector level. In line with the literature on the sectoral systems of innovation, we find that sector specificities matter in determining R&D per patent investments, economies of scale in knowledge production, and the cost associated to technological specialization. Moreover, our results suggest that the persistent differences in R&D intensity across firms may be largely related to the technological choices they make. Firms' idiosyncrasies co-exist with significant differences across sectors in shaping knowledge production functions. Implications for policy and research are discussed accordingly. Show less
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Do firms publish? A multi-sectoral analysis
We examine corporate publishing - i.e. firms' involvement in the production of scientific publications - with two research questions. First,… Show more why do firms publish? Through systematic literature review, we propose a framework of five incentives for firms to publish: (i) accessing external knowledge and resources; (ii) attracting and retaining researchers; (iii) signalling and reputation building; (iv) supporting IP strategies; and (v) supporting commercialization strategies. Second, how does firms' engagement in publishing differ across sectors? Variation in corporate publishing has not yet been comprehensively characterized in the literature. We present an empirical analysis of the publication activity of a global sample of 2,500 firms (and the 570,000 directly owned subsidiaries of these firms) operating in 20 industrial sectors. We find that corporate publishing is widespread, though considerable heterogeneity exists within and between sectors. Most firms (84%) in our sample contributed to at least one publication from 2011 to 2015. The number of firms' publications grew over the observation period (2.3% on a yearly basis), though not as fast as the global science output in general. Firms' publications are often co-authored with researchers at academic institutions (58%) and are cited more than expected (about 12% of firms' articles are within the top 10% most cited articles). We conclude by proposing a taxonomy of sectors based on their R&D investment intensity and publication activity. Show less