Persistence of Innovation in Dutch Manufacturing: Is it Spurious?

Raymond, Wladimir; Mohnen, Pierre; Palm, Franz C.; van der Loeff, Sybrand Schim

doi:10.2139/ssrn.894203

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Persistence of Innovation in Dutch Manufacturing: Is it Spurious?

CESifo Working Paper Series No. 1681

32 Pages Posted: 31 Mar 2006

See all articles by Wladimir Raymond

Franz C. Palm

University of Maastricht - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Sybrand Schim van der Loeff

University of Maastricht

Date Written: March 2006

Abstract

This paper studies the persistence of innovation and the dynamics of innovation output in Dutch manufacturing using firm data from three waves of the Community Innovation Surveys (CIS), pertaining to the periods 1994-1996, 1996-1998, and 1998-2000. We estimate by maximum likelihood a dynamic panel data type 2 tobit model accounting for individual effects and handling the initial conditions problem. We find that there is no evidence of true persistence in achieving technological product or process innovations, while past shares of innovative sales condition, albeit to a small extent, current shares of innovative sales.

Keywords: dynamic panel data type 2 tobit, innovation, spurious persistence

JEL Classification: C33, C34, O31

Suggested Citation: Suggested Citation

Raymond, Wladimir and Mohnen, Pierre and Palm, Franz C. and van der Loeff, Sybrand Schim, Persistence of Innovation in Dutch Manufacturing: Is it Spurious? (March 2006). CESifo Working Paper Series No. 1681, Available at SSRN: https://ssrn.com/abstract=894203 or http://dx.doi.org/10.2139/ssrn.894203