In Search of Lost Disincentive Effects from Intra-Industry Spillovers

Lhuillery, S. (2011). Absorptive capacity, efficiency effect and competitors’ spillovers. Journal of Evolutionary Economics, 21(4), 649-663.

16 Pages Posted: 27 Jun 2009 Last revised: 10 Jan 2014

See all articles by Stephane Lhuillery

Stephane Lhuillery

Neoma Business School; University of Strasbourg - Bureau of Economic Theory and Application (BETA)

Date Written: March 1, 2009

Abstract

Standard innovation surveys do not consider incoming spillovers for non-innovative firms. The Swiss innovation surveys presented here measure the importance of competitors’ knowledge for both innovating and noninnovating firms. This original feature not only enables us to accurately identify the role of incoming knowledge on R&D decisions and innovation output, but also to compare resulting data with those which standard innovation questionnaires provide. Using a panel data over four periods, we show that knowledge from rivals actually deters manufacturing firms from engaging in R&D activities. Moreover, we provide stronger evidence that intra-industry spillovers are more detrimental to innovation than that generally provided by data from standard surveys. The results suggest that the dominance of the absorptive capacity effect is more important to firms investing in R&D and that non-innovative firms rely more heavily than expected on their competitors to maintain their technological capacities.

Keywords: intra-industry spillovers, absorption, innovation survey

JEL Classification: O31, C35, C81

Suggested Citation

Lhuillery, Stephane, In Search of Lost Disincentive Effects from Intra-Industry Spillovers (March 1, 2009). Lhuillery, S. (2011). Absorptive capacity, efficiency effect and competitors’ spillovers. Journal of Evolutionary Economics, 21(4), 649-663., Available at SSRN: https://ssrn.com/abstract=1425918 or http://dx.doi.org/10.2139/ssrn.1425918

Stephane Lhuillery (Contact Author)

Neoma Business School ( email )

1 Rue du Maréchal Juin
Mont Saint Aignan Cedex, 76825
France

University of Strasbourg - Bureau of Economic Theory and Application (BETA) ( email )

France

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