The economic impact of technological procurement for large-scale research infrastructures: Evidence from the Large Hadron Collider at CERN

Paolo Castelnovo, Massimo Florio, Stefano Forte, Lucio Rossi and Emanuela Sirtori

Research Policy, 2018, vol. 47, issue 9, 1853-1867

Abstract: The Large Hadron Collider at CERN, the European Organisation for Nuclear Research, is the world’s highest-energy particle accelerator. Its construction (1995–2008) required frontier technologies and close collaboration between CERN scientists and contracting firms. The literature on “Big Science” projects suggests that this collaboration generated economic spillovers, particularly through technological learning. CERN granted us access to its procurement database, including suppliers of LHC from 35 countries for orders over 10,000 Swiss Francs. We gathered balance-sheet data for more than 350 of these companies from 1991 to 2014, which include the years before and after that of the first order received. The study assesses, in quantitative terms, whether becoming a CERN supplier induced greater R&D effort and innovative capacity, thus enhancing productivity and profitability. The findings – which controlled for firms’ observable characteristics, macroeconomic conditions, and unobserved time, country, industry and firm-level fixed effects – indicate a statistically significant correlation between procurement events and company R&D, knowledge creation and economic performance. The correlation is chiefly driven by high-tech orders; for companies receiving non-high-tech orders, it is weaker, or even statistically not significant.

Keywords: Public procurement; CERN; Large hadron collider; Technological spillovers (search for similar items in EconPapers)
JEL-codes: O30 O33 Q55 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:47:y:2018:i:9:p:1853-1867

DOI: 10.1016/j.respol.2018.06.018

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