Do Export and Technological Specialisation Patterns Co-evolve in Terms of Convergence or Divergence? Evidence From 19 OECD Countries, 1971-1991

Several researchers looking at the development of international export specialisation patterns have shown that there is a general tendency for OECD countries to de-specialise. This finding is in contrast to findings made by other authors, working on technological specialisation. These authors found increasing technological specialisation. The first aim of this paper is to investigate whether these contradictory findings are due to a real world phenomenon, or whether the explanation is purely technical, by comparing the development of export specialisation to specialisation in terms of US patents, using the same methodology, and level of aggregation. The second aim is to analyse the extent to which countries and sectors display stable specialisation patterns over time, also both in terms of exports and in terms of technology. The paper confirms that the OECD countries did in general de-specialise in terms of export specialisation. The evidence is less conclusive with regard to technological specialisation, as the results are mixed in the sense that just about half of the countries tend to increase in terms of the level of specialisation, while the other half tend to engage in de-specialisation. In terms of country and sectoral stability of specialisation patterns, it can be concluded that both trade specialisation and technological specialisation patterns are path-dependent in the sense that all country and sectoral patterns are correlated between seven three year intervals, within the period in question. In comparison however, trade specialisation patters are more stable than are technological specialisation patterns.trade specialisation, technological specialisation, structural change

Revealed Comparative Advantage and the Alternatives as Measures of International Specialisation

The paper is an analysis of Balassa’s ‘revealed comparative advantage’ (RCA). The papers shows that when using the RCA, it should always be adjusted in such a way, so that it becomes symmetric. The conclusion is based on a theoretical discussion of the properties of the measure, but also on convincing empirical evidence, based on the Jarque-Bera test of normality of the error terms from regressions, using both the RCA and the ‘Revealed Symmetric Comparative Advantage’ (the RSCA). The RSCA is also compared to other measures of international trade specialisation. These measures included the Michaely index and the chi square measure. The conclusion emerging from the analysis is that the RSCA is - on balance - the best measure of comparativerevealed comparative advantage, international specialisation

The Impact of Technological Opportunity on the Dynamics of Trade Performance

The paper explores firstly the impact of technological change on trade growth at the country level, using trade statistics and statistics on patenting activity in the US, across 20 countries for 17 manufacturing sectors. Secondly, using structural decomposition analysis, the paper examine whether the degree to which countries get access to sectors with above average growth in technological opportunity has any impact on growth in aggregate market shares of exports. The results demonstrate that there is a positive relationship between change in trade performance and change in technological capabilities across countries for 8 ‘technology intensive’ sectors over the period 1965-1988. It is also shown that there appear to be some (however weak) relationship between the degree to which countries get access to sectors with above average growth in technological opportunity and growth in aggregate market shares. However, there seems to be a much stronger positive relationship between growth rates in trade performance and the individual ‘national innovation system’s’ ability to actively move into technological sectors offering above average technological opportunity.Technological opportunity, trade growth, national systems of innovation, structural decomposition analysis

How Structural Change Differs, and Why it Matters (for Economic Growth)

Several types of theoretical literature on the topic of trade, growth and specialisation, including neoclassical approaches, post-Keynesian literature and some models in evolutionary economics, have shown that it is possible enjoy higher rates of economic growth, given the presence of certain sectors in the economy, being it high-tech or fast-growing sectors. This paper investigates these propositions empirically. Basically the idea is to conduct a constant market share (CMS) analysis, and afterwards include the obtained effects in regression models, using panel data techniques in explaining aggregate economic growth. The results display that the fixed effects model is the most appropriate technique, and that using this tool, the initial level of income (the catch up variable) is significant and has a negative sign as expected. The investment (growth of the capital stock) variable is also significant, while the growth adaptation effect (measuring whether the country in question has actively (more than the average country) moved into slow or fast growing sectors) is the only significant variable (positive sign) of the CMS effects. Hence, it is concluded that a certain dynamism in terms of structural change is required by countries in order to achieve high levels of economic growth at the macro level. The final part of the paper deals with the question of whether the fast-growing sectors (as measured in the CMS analysis) are high-tech or not. Based on a comparison between the OECD growth vector from the CMS analysis, on the one hand, and R&D intensities in the 22 sectors (for the 1970s and for the 1980s), on the other, it is concluded that the fast-growing sectors are in general also high-tech sectors.trade specialisation, economic growth, constant market share analysis, panel data

Searching Low and High What Types of Firms use Universities as a Source of Innovation?

This paper examines the factors that influence whether firms draw from universities in their innovative activities. The link between the universities and industrial innovation, and the role of different search strategies in influencing the propensity of firms to use universities is explored. The results suggest that firms who adopt “open” search strategies and invest in R&D are more likely than other firms to draw from universities, indicating that managerial choice matters in shaping the propensity of firms to draw from universities.University-industry links, innovation, external search strategies

Do Inter-sectoral Linkages Matter for International Export Specialisation?

This paper basically adopts a ‘technology gap’ approach for explaining international export specialisation. Within this broad label there has been one tradition which has applied cumulativeness in technological change as an explanation, while another tradition has emphasised the role of inter-sectoral linkages (the so-called home market effect) in this context. However, given that the sources of innovation (inducements mechanisms) differ between firms according to principal sector of activity, different variables should not be expected to be of equal importance across industrial sectors. Thus, using the Pavitt taxonomy as a starting point, the paper statistically investigates the importance of variables reflecting different inducement mechanisms, across 9 OECD countries. The paper concludes that the two types of technological activities, namely technological activities in the ‘own’ sector, and inter-sectoral linkages are both important in the determination of national export specialisation patterns. However, the importance differ according to the mode of innovation in each type of sector.international export specialisation, patent data, input-output analysis, inter-sectoral li

The effect of regional social capital and external knowledge acquisition on process and product innovation.

To introduce new products and processes, firms often need to acquire knowledge developed in other firms and organizations. Drawing on social capital and transaction cost theory, we argue that not only is the success of such acquisitions for the development of product and product innovations dependent on strategic and economic variables, it may also be contingent on the social capital available in the geographical area in which the firm is located. Combining data on social capital at the level of 21 regions with a large scale data set on innovative activities by a representative sample of 2464 Italian manufacturing firms, we find that — after controlling for a large set of firm characteristics and regional variables — being located in regions characterized by high level of social interaction leads to a higher propensity to innovate. Moreover, being located in an area characterized by a high degree of social interaction positively moderates the effectiveness of externally acquired R&D on innovation inclination. Key words: social capital; external acquisition; process innovation; product innovation.social capital; external acquisition; process innovation; product innovation

The Fruits of Intellectual Production: Economic and scientific specialisation among OECD countries

This paper brings together data from 14 OECD countries on scientific publications, patents and production specialisation to explore the relationship between economic and production specialisation for 17 manufacturing sectors. Since Marx, there has been a fundamental debate in economics about the link between science and the economic system. Marx argued that the developments in the science system are strongly influenced by changes in the economic sphere, whereas Polanyi argued that developments in science are largely independent of economic sphere. Using a panel data model and econometric estimations at the sectoral-level, the paper assesses the two positions and finds considerable support for Marx's position, that is, that scientific and production specialisation are, often, tightly linked.Scientific specialisation, international economic specialisation, bibliometric data

The Fruits of Intellectual Production Economic and Scientific Specialisation Among OECD Countries

This paper brings together data from 14 OECD countries on scientific publications, patents and production specialisation to explore the relationship between economic and production specialisation for 17 manufacturing sectors. Since Marx, there has been a fundamental debate in economics about the link between science and the economic system. Marx argued that the developments in the science system are strongly influenced by changes in the economic sphere, whereas Polanyi argued that developments in science are largely independent of economic sphere. Using a panel data model and econometric estimations at the sectoral-level, the paper assesses the two positions and finds considerable support for Marx’s position, that is, that scientific and production specialisation are, often, tightly linked.Scientific specialisation, international economic specialisation, bibliometric data

Performance Pay, Delegation, and Multitasking under Uncertainty and Innovativeness An Empirical Investigation

The existing empirical evidence is somewhat inconclusive with respect to a number of the key predictions of the agency model. Although the reach of agency theory is considerably wider, the dominant portion of work has been taken up with examining the nature of the trade-off between risk and incentives, and the implications thereof for contractual design. More specifically, some researchers have recently noted that the predicted trade-off between risk and incentives turns out to be rather weak, and perhaps non-existent, when confronted with the available empirical evidence. In this paper, we examine the risk-incentives trade-off and related predictions from agency theory on the basis of data from a data set encompassing close to 1000 Danish firms. We find that the relation between the use of performance pay in these firms and the environmental uncertainty they confront which is one way to test the risk/incentives tradeoff is indeed weak and in many cases even perverse. We then suggest, in line with other recent contributions to the literature, that this may be caused by the widespread use of delegation. One effect of delegation is that it breaks the simple relation between risks and incentives. We examine the suggestion that that those firms that are more prone to use delegation of decision rights in their internal organization are facing an uncertain environment to a larger extent than the rest of the population. We argue that this constitutes an indirect confirmation of the hypothesis. We also examine the multi-tasking agency hypothesis that as risk increases, the flexibility of agents is restricted. We fail to find support for this hypothesis. It is suggested that the reason for this finding is also related to delegation.Uncertainty, pay-for-performance, delegation, innovation, competition