Do External Technology Acquisitions Matter for Innovative Efficiency and Productivity?

Tseveen Gantumur and Andreas Stephan

No 1035, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: To quickly adapt to technological change and developments, and thus remain competitive, firms increasingly resort to the use of external technology. This paper investigates whether and to what extent the acquisition of external disembodied technology affects the efficiency and productivity in innovation of technology acquiring firms. Using the stochastic frontier analysis combined with a difference-in-difference matching approach and firm-level panel from the German Innovation Survey for the period 1992-2004, we find that manufacturing firms that acquire disembodied technology experience more growth in innovative productivity than non-acquiring firms do. Thus, this study provides evidence on complementarity between internal and external R&D in innovation production, which is attributed by increasing returns to R&D scale and increasing technical efficiency. Moreover, we find that firm size significantly contributes to innovative efficiency and productivity of external technology acquirers.

Keywords: Technology acquisition; innovative efficiency; innovative productivity; SFA; Difference-in-difference matching (search for similar items in EconPapers)
JEL-codes: L24 L25 L60 O30 (search for similar items in EconPapers)
Pages: 39 p.
Date: 2010
New Economics Papers: this item is included in nep-cse, nep-eff, nep-ino, nep-knm, nep-mic, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Working Paper: Do External Technology Acquisitions Matter For Innovative Efficiency and Productivity? (2010)
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