Competition and innovation: an inverted U relationship

This paper investigates the relationship between product market competition (PMC) and innovation. A Schumpeterian growth model is developed in which firms innovate ‘step-by-step’, and where both technological leaders and their followers engage in R&D activities. In this model, competition may increase the incremental profit from innovating; on the other hand, competition may also reduce innovation incentives for laggards. This model generates four main predictions which we test empirically. First, the relationship between product market competition (PMC) and innovation is an inverted U-shape: the escape competition effect dominates for low initial levels of competition, whereas the Schumpeterian effect dominates at higher levels of competition. Second, the equilibrium degree of technological ‘neck-and-neckness’ among firms should decrease with PMC. Third, the higher the average degree of ‘neck-and-neckness’ in an industry, the steeper the inverted-U relationship between PMC and innovation in that industry. Fourth, firms may innovate more if subject to higher debt-pressure, especially at lower levels of PMC. We confront these four predictions with a new panel data set on UK firms’ patenting activity at the US patenting office. The inverted U relationship, the neck and neck, and the debt pressure predictions are found to accord well with observed behavior in the data

Competition and innovation: an inverted U relationship?

This paper investigates the relationship between product market competition and innovation. It uses the radical policy reforms in the UK as instruments for changes in product market competition, and finds a robust inverted-U relationship between competition and patenting. It then develops an endogenous growth model with step-by-step innovation that can deliver this inverted-U pattern. In this model, competition has an ambiguous effect on innovation. On the one hand, it discourages laggard firms from innovating, as it reduces their rents from catching up with the leaders in the same industry. On the other hand, it encourages neck-and-neck firms to innovate in order to escape competition with their rival. The inverted-U pattern results from the interplay between these two effects, together with the effect of competition on the equilibrium industry structure. The model generates two additional predictions: on the relationship between competition and the average technological distance between leaders and followers across industries; and on the relationship between the distance of an industry to its technological frontier and the steepness of the inverted-U. Both predictions are supported by the data

Virtue and austerity

Virtue ethics is often proposed as a third way in health-care ethics, that while consequentialism and deontology focus on action guidelines, virtue focuses on character; all three aim to help agents discern morally right action although virtue seems to have least to contribute to political issues, such as austerity. I claim: (1) This is a bad way to characterize virtue ethics. The 20th century renaissance of virtue ethics was first proposed as a response to the difficulty of making sense of ‘moral rightness’ outside a religious context. For Aristotle the right action is that which is practically best; that means best for the agent in order to live a flourishing life.There are no moral considerations besides this. (2) Properly characterized, virtue ethics can contribute to discussion of austerity. A criticism of virtue ethics is that fixed characteristics seem a bad idea in ever-changing environments; perhaps we should be generous in prosperity, selfish in austerity. Furthermore, empirical evidence suggests that people indeed do change with their environment. However, I argue that virtues concern fixed values not fixed behaviour; the values underlying virtue allow for different behaviour in different circumstances: in austerity, virtues still give the agent the best chance of flourishing. Two questions arise. (a) In austere environments might not injustice help an individual flourish by, say, obtaining material goods? No, because unjust acts undermine the type of society the agent needs for flourishing. (b) What good is virtue to those lacking the other means to flourish? The notion of degrees of flourishing shows that most people would benefit somewhat from virtue. However, in extreme circumstances virtue might harm rather than benefit the agent: such circumstances are to be avoided; virtue ethics thus has a political agenda to enable flourishing. This requires justice, a fortiori when in austerity

The star-formation rate in the host of GRB 990712

We have observed the host galaxy of GRB 990712 at 1.4 GHz with the Australia Telescope Compact Array, to obtain an estimate of its total star-formation rate. We do not detect a source at the position of the host. The 2 sigma upper limit of 70 microJy implies that the total star-formation rate is lower than 100 Msun/yr, using conservative values for the spectral index and cosmological parameters. This upper limit is in stark contrast with recent reports of radio/submillimeter-determined star-formation rates of roughly 500 Msun/yr for two other GRB host galaxies. Our observations present the deepest radio-determined star-formation rate limit on a GRB host galaxy yet, and show that also from the unobscured radio point-of-view, not every GRB host galaxy is a vigorous starburst.Comment: A&A Letters, in press, 5 pages; a high-resolution color gif version of the paper figure is also supplie

The impact of health on professionally active people's incomes in Poland. Microeconometric analysis

The outcome of the research confirms the occurrence of positive interaction between professionally active people's incomes and the self-assessed state of health. People declaring a bad state of health have incomes by 20% on average lower than people who enjoy good health (assuming that the remaining characteristics of the surveyed person are the same). In case of men, the impact of health state on incomes is slightly greater than in case of women.Wyniki badań potwierdzają istnienie pozytywnej zależności dochodów osób aktywnych zawodowo od stanu zdrowia mierzonego jego samooceną. Osoby deklarujące zły stan zdrowia osiągają dochody przeciętnie o 20% niższe niż osoby, które cieszą się dobrym stanem zdrowia (przy założeniu, że pozostałe charakterystyki badanej osoby są takie same). W przypadku mężczyzn zależność dochodów od stanu zdrowia jest nieznacznie silniejsza niż w przypadku kobiet

The Discovery and Broad-band Follow-up of the Transient Afterglow of GRB 980703

We report on the discovery of the radio, infrared and optical transient coincident with an X-ray transient proposed to be the afterglow of GRB 980703. At later times when the transient has faded below detection, we see an underlying galaxy with R=22.6; this galaxy is the brightest host galaxy (by nearly 2 magnitudes) of any cosmological GRB thus far. In keeping with an established trend, the GRB is not significantly offset from the host galaxy. Interpreting the multi-wavelength data in the framework of the popular fireball model requires that the synchrotron cooling break was between the optical and X-ray bands on July 8.5 UT and that the intrinsic extinction of the transient is Av=0.9. This is somewhat higher than the extinction for the galaxy as a whole, as estimated from spectroscopy.Comment: 5 pages, 3 figures, and 2 tables. Submitted to the Astrophysical Journal Letters on 27 August 199

Calculating Colimits Compositionally

We show how finite limits and colimits can be calculated compositionally using the algebras of spans and cospans, and give as an application a proof of the Kleene Theorem on regular languages

Critical behavior in a cross-situational lexicon learning scenario

The associationist account for early word-learning is based on the co-occurrence between objects and words. Here we examine the performance of a simple associative learning algorithm for acquiring the referents of words in a cross-situational scenario affected by noise produced by out-of-context words. We find a critical value of the noise parameter $\gamma_c$ above which learning is impossible. We use finite-size scaling to show that the sharpness of the transition persists across a region of order $\tau^{-1/2}$ about $\gamma_c$, where $\tau$ is the number of learning trials, as well as to obtain the learning error (scaling function) in the critical region. In addition, we show that the distribution of durations of periods when the learning error is zero is a power law with exponent -3/2 at the critical point

Systematic study of Optical Feshbach Resonances in an ideal gas

Using a narrow intercombination line in alkaline earth atoms to mitigate large inelastic losses, we explore the Optical Feshbach Resonance (OFR) effect in an ultracold gas of bosonic $^{88}$Sr. A systematic measurement of three resonances allows precise determinations of the OFR strength and scaling law, in agreement with coupled-channels theory. Resonant enhancement of the complex scattering length leads to thermalization mediated by elastic and inelastic collisions in an otherwise ideal gas. OFR could be used to control atomic interactions with high spatial and temporal resolution.Comment: Significant changes to text and figure presentation to improve clarity. Extended supplementary material. 4 pages, 4 figures; includes supplementary material 8 pages, 4 figures. Submitted to Physical Review Letter