Long-run versus short-run decisions: R&D and market structure in Spanish firms

Joaquín Artés

Research Policy, 2009, vol. 38, issue 1, pages 120-132

Abstract: I present new econometric evidence on the relation between market structure and R&D using data on Spanish firms. I adopt a different approach from previous studies by distinguishing between long-run and short-run decisions of firms regarding R&D. I assume that the long-run or strategic decision is whether to conduct R&D or not, and the short-run choice is how much to invest once the firm decides to be innovative. I argue that market structure affects long-run R&D decisions but does not affect short-run ones. A Heckman-type selection model is used to test such a relation. The results are robust to several specifications and measures of monopoly power.

Keywords: R&; D; Market; structure; Sample; selection; Multiple; imputation (search for similar items in EconPapers)
Date: 2009

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Persistent link: http://EconPapers.repec.org/RePEc:eee:respol:v:38:y:2009:i:1:p:120-132

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Research Policy is edited by M. Callon, M. Bell, F. Kodama, B. Martin, F. Meyer-Krahmer, W. W. Powell, S. Thomke and N. Von Tunzelmann

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