Research Cooperation and Research Expenditures with Endogenous Absorptive Capacity Theory and Microeconometric Evidence for the German Services

40 Pages Posted: 29 May 2003

See all articles by Ulrich Kaiser

Ulrich Kaiser

University of Southern Denmark - Faculty of Social Sciences; Center for Economic and Business Research (CEBR); Centre for European Economic Research

Date Written: July 2000

Abstract

This paper derives a three stage Cournot duopoly game for research collaboration, research expenditures and product market competition. The amount of knowledge firms can absorb from other firms is made dependent on their own research efforts, e.g., firms' absorptive capacity is treated as an endogenous variable. It is shown that cooperating firms invest more in R&D than non-cooperating firms if spillovers are sufficiently large. Further, market demand and R&D productivity have a positive effect on R&D efforts both under research joint venture and under research competition. Firms' propensity to collaborate in R&D is increasing in R&D productivity. The key findings of the theoretical model are tested using German innovation survey data for the service sector. A simultaneous model for cooperation choice and innovation expenditures shows that R&D cooperation has a weakly significant positive effect on innovation expenditures. The empirical results broadly support the theoretical model.

Keywords: research cooperation, research expenditures, knowledge spillovers, simultaneous equation model, services

JEL Classification: C35, O31

Suggested Citation

Kaiser, Ulrich, Research Cooperation and Research Expenditures with Endogenous Absorptive Capacity Theory and Microeconometric Evidence for the German Services (July 2000). ZEW Discussion Paper No. 00-25. Available at SSRN: https://ssrn.com/abstract=378160 or http://dx.doi.org/10.2139/ssrn.378160

Ulrich Kaiser (Contact Author)

University of Southern Denmark - Faculty of Social Sciences ( email )

Campusvej 55
DK-5230 Odense M
Denmark

HOME PAGE: http://www.sam.sdu.dk/staff/uka

Center for Economic and Business Research (CEBR) ( email )

Porcelaenshaven, Bldg 65
DK-2000 Frederiksberg
Denmark

HOME PAGE: http://www.cebr.dk/uk

Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1 D-68161 Mannheim
Germany

HOME PAGE: http://www.zew.de/de/mitarbeiter/mitarbeiter.php3?action=mita&kurz=uka

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