What Goes on Under the Hood? How Engineers Innovate in the Automotive Supply Chain
27 Pages Posted: 21 Feb 2015
Date Written: April 1, 2013
This paper takes a detailed look at the automotive supply chain to gain insight into how engineers generate innovation. Using survey data and observations from dozens of site visits to manufacturers, we characterize the incremental improvements in processes and product quality that accumulate to produce economically significant change. Much of this innovative activity is “invisible” because it is unpatented or because the many small- to medium-sized enterprises we survey do not measure R&D spending. Thus, our survey provides new measures of innovation not addressed by existing measures, especially patents and R&D spending. Consistent with other in-depth studies of engineering work, we find that many non-engineers are engaged in innovative activity. Also, we find that firm’s relationship to its customers affect the ability to invest in innovation.
Keywords: engineering, innovation, automotive, supply chain, small- and medium-sized enterprises
JEL Classification: L62, O32
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