Do specialists exit the firm outsourcing its R&D?

Wenjing Want ()
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Wenjing Want: Department of Economics and Business, Aarhus University, Denmark, Postal: 8210 Aarhus V, Denmark

Economics Working Papers from Department of Economics and Business Economics, Aarhus University

Abstract: Do specialists exit the firm increasingly outsourcing its research and development (R&D) work? Although this question is critical in understanding how R&D outsourcing links to innovation performance, the answer is not yet clear. This paper proposes that the optimal level of firm’s internal employment of R&D specialists decreases with the deepening of R&D outsourcing but increases with the broadening of R&D outsourcing. These relations can be inferred from previous empirical studies as well as our theoretical analysis, and are supported by the empirical evidence from estimations of correlated random effects (CRE) Tobit, CRE selection and CRE fractional response models on a panel dataset of Danish firms.

Keywords: Correlated random effect models; employment of R&D specialists; R&D strategy; R&D outsourcing breadth and depth (search for similar items in EconPapers)
JEL-codes: J21 M51 O32 (search for similar items in EconPapers)
Pages: 51
Date: 2014-09-03
New Economics Papers: this item is included in nep-cse, nep-ind, nep-ino, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:aah:aarhec:2014-21

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