Abstract
For scale-intensive industries and science-based industries in Germany, we investigate the question whether firms combining internal R&D and acquisition of capital with embodied technology demonstrate better product and process innovation performance than companies using only one of those innovation strategies. Our approach comprises both indirect and direct complementarity tests between those two innovation activities. The empirical results suggest that the combination strategy provides a distinct advantage to companies both in producing product and process innovations. In particular, in product innovations, firms demonstrate a higher novelty degree of their goods, while in process innovations they provide a higher quality improvement (in the science-based industries only) and a significant cost reduction (in the science-based and scale-intensive industries).
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Notes
See the detailed explanation of the industry classification in the “Appendix”. The abbreviations are used henceforth in this paper.
The number is a result of summing up firms which either exclusively use acquisition with embodied technology (65%), or combine it with internal R&D (12%).
We acknowledge that this variable does not necessarily account for the factual level of competition on the market. However, other measures of competitiveness, suh as the Lerner index are not provided in the dataset.
One could also use the firm's turnover instead, but this is a too volatile measure.
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Acknowledgements
NW acknowledges support from Beijing Natural Science Foundation (9202004). NW acknowledges support from National Natural Science Foundation of China (71602006). IS acknowledges financial support from the RFBR grant No. 18-010-01190.
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Wang, N., Xiao, M. & Savin, I. Complementarity effect in the innovation strategy: internal R&D and acquisition of capital with embodied technology. J Technol Transf 46, 459–482 (2021). https://doi.org/10.1007/s10961-020-09780-y
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DOI: https://doi.org/10.1007/s10961-020-09780-y