External Effects as a Microeconomic Determinant of Innovation Efficiency

Hariolf Grupp

International Journal of the Economics of Business, 1997, vol. 4, issue 2, 173-188

Abstract: Recent studies point to the significant effects unintended technological spillover has on profits, market value and patent output of enterprises. The public good character relates not only to technology, but also to (public) science. The paper introduces a new data source on German businesses making possible new variables for innovation, spillover, investment and competition. By employing Data Envelopment Analysis (DEA), innovation efficiency and the role of externalities is modelled and explained. For this sample, neither advantages nor disadvantages in innovation efficiency are found on the part of large firms. This emphasises the fragility of the size hypothesis in industrial economics. Instead, the firms with more activity in interconnected, spilling-over technologies are the efficient ones. The benefits from appropriation of spillovers seem to outweigh- any unintended losses of know-how to competitors

Keywords: Innovation efficiency; Spillovers; Competition; Profitability; DEA, JEL classification: O31, L21, H4, O33, (search for similar items in EconPapers)
Date: 1997
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Citations: View citations in EconPapers (2)

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DOI: 10.1080/758516226

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