Patents and R&D: an econometric investigation using applications for German, European and US patents by German companies

Based on the data of the first wave of the Mannheim Innovation panel, this paper explores the link between R&D expenditures and patents. Our data allow a detailed analysis of the firm size distribution of R&D and patent applications at different patent offices. It is shown that the share of R&D performing firms is strictly increasing with firm size. The share of firms applying for patents shows an even steeper increase with firm size. Moreover, large firms more likely apply for patents in more than one country. The home patent office seems to be especially important for small firms. Using various count data models, the paper explores the relationship between R&D and patents at the firm level. We carefully test several distributional assumptions for count data models. A negbin hurdle model seems to be the most appropriate count data model for our data as the decision to patent inventions and the productivity of R&D are ruled by different mechanisms. Our estimates point towards significant returns to scale of R&D. Furthermore, the empirical results can be interpreted towards minor and insignificant spillover effects. Even after controlling for a variety of firm characteristics, firm size exhibits a large effect on the propensity to patent. --

Assimilation, labour market experience, and earnings profiles of temporary and permanent immigrant workers in germany

We test the assimilation hypothesis as initially proposed by Chiswick (1978) by making. use of a rich panel dataset for Germany which allows us to control for unobserved population heterogeneity and potential selectivity bias arising from an individual's re-migration decision and employment behaviour. To take into account the institutional aspects of the German guest-worker system we use information on an immigrant's expected duration of stay in Germany to distinguish between temporary and permanent migrants and to test for differences in earnings/experience profiles with respect to a foreigner's expected duration of stay. We find that years of schooling in Germany have a strong positive effect on earnings, that earnings/experience profiles of guest-workers differ by expected duration of stay, and that the renumeration of labour market experience in Germany is higher for natives than for most foreigners. The assimilation hypothesis is therefore not supported by the evidence for Germany. --

The impact of the provision of public infrastructures on regional economic development in Germany

The present paper presents an analysis of the impact of public infrastructure capital on regional economic developments in Germany. After presenting some descriptive statistical data on the economies of the 11 regions in (West) Germany a simple theoretical model of a cost-minimizing firm is presented in which the stock of public capital is included as a proxy for public services provided to firms as a fixed unpaid factor of production. Duality theory is used to recover the productivity effects of public infrastructures by calculating the cost-saving effects that are associated with public services. It is shown that these cost-saving effects work their way through adjustments in the demand for private inputs. Using a translog cost 'function we present panel estimates for the 11 federal states of (West) Germany with labour, structures and equipment as private factors of production. The results strongly indicate that public capital formation encourages private investment. In addition, it is demonstrated empirically that with respect to private capital a distinction between structures and equipment is of crucial importance because the effects on the former are of far greater importance than the effects on the latter. --

Innovation and Information Technology in Services

The missing effect of investments of firms in information and communication technologies on productivity is studied by various recent papers (e.g. Oliner and Sichels 1994, Landauer 1995, Brynjolfsson and Hitt 1996). Several explanations are given for this missing link. Our paper deals with two of them, using two newly available data sets for the German service sector. Using data from a survey of innovative activities in services we show that investment in information technology (IT) has a stronger effect on the quality of services than on the productivity of the IT-using firm. IT investment seems to be especially effective when innovations enhance the delivery speed and the spatial or temporal availability of service. Moreover, data of the German IT survey point towards the need to differentiate between types of IT investment. It is shown that especially the most recent generation of IT as indicated by the number of PCs used is the source of productivity growth whereas traditional IT like mainframes exhibit only minor productivity effects. We conclude from our results that mismeasurement of the quality of new products and processes is one important reason for our inability to uncover the productivity effect of IT. Moreover, dividing IT-investment by the type of IT clarifies that the kind of IT a firm uses is more important for productivity growth what than its quantity. In any case we expect that the bulk of the IT-related productivity growth is still to come. In order to realize the benefits from IT investment entirely, firms have to undergo a large restructuring of business functions. --Information Technology,Productivity,Service Sector

Regional productivity growth and investments in public infrastructure: the case of Germany

This paper examines whether the productivity growth in the West-German states is influenced by the provision of public infrastructure. Medium-term labour productivity growth and output growth varies a lot between German states. This differences are more pronounced during the eighties. The traditional total factor productivity shows a smaller difference than labour productivity. The regional differences in the productivity growth rates can only partly be attributed to the differences in factor input growth. We estimate a translog-cost-function for the period 1970-1988 for 11 German states using a three-equation fixed-effects panel data model. We show that there are important cost-saving effects that are associated with public services. Likewise, the demand for labour, and the private investment demand for structures and equipment is effected by public capital goods. Our estimates indicate that public capital formation encourages private investment. This effect is especially strong with respect to the private demand for structures. These results confirm that regional or urban economic growth can be forstered by the government by public investment. --

Testing for state dependence effects in a dynamic model of male unemployment behaviour

A dynamic random effects probit model is estimated on the first six waves of the German Socio-Economic Panel to test for state dependence effects in male unemployment behaviour. Estimation of the model is based on the marginal likelihood approach. In the model an individual's unemployment probability at a given point in time within the period 1985 - 1989 depends on his labour force status in the previous period and on the cumulated duration of past unemployment. Controlling for observed and unobserved population heterogeneity, we show that there are strong state dependence effects in individual unemployment dynamics with respect to both the incidence and the duration of an individual's past unemployment. These results are compatible with the 'scar theory' of unemployment which holds that an individual's previous unemployment experience may have long-term effects because it induces a depreciation of human capital and/or acts as a screening device in employers hiring decisions. --

Innovation and Information Technology in Services

The missing effect of investments of firms in information and communication technologies on productivity is studied by various recent papers. Several explanations are given for this missing link. Our paper deals with two of them, using two newly available data sets for the German service sector. Using data from a survey of innovative activities in services we show that investment in information technology (IT) has a stronger effect on the quality of services than on the productivity of the IT-using firm. IT investment seems to be especially effective when innovations enhance the delivery speed and the spatial or temporal availability of service. Moreover, data of the German IT survey point towards the need to differentiate between types of IT investment. It is shown that especially the most recent generation of IT as indicated by the number of PCs used is the source of productivity growth whereas traditional IT like mainframes exhibit only minor productivity effects. We conclude from our results that mismeasurement of the quality of new products and processes is one important reason for our inability to uncover the productivity effect of IT. Moreover, dividing IT-investment by the type of IT clarifies that the kind of IT a firm uses is more important for productivity growth what than its quantity. In any case we expect that the bulk of the IT-related productivity growth is still to come. In order to realize the benefits from IT investment entirely, firms have to undergo a large restructuring of business functions

New Technology-Based Firms in Germany: A Survey of the Recent Evidence

The Importance and Contribution of new technology-based Firms (NTBFs) to long term economic development is at the center of a controversial debate. This paper provides an overview of the current status of research on various issues concerning NTBFs in Germany. The issues covered include the incidence of start-ups firms in Germany's technology-intensive sectors and their regional clustering. The review also shows that NTBFs play an important role with regard to the transfer, adoption and diffusion of technology. The public support and policy initiatives for new technology-based firms in Germany are also discussed

Business angels : crucial elements of the European financial ecosystem

Europa steht vor einem Innovationsrätsel. Trotz hoher Forschungsinvestitionen und marktführender Unternehmen in vielen Branchen, gehen disruptive und radikale Innovationen meist nicht von europäischen Start-ups aus. Ein Grund dafür sind finanzielle Engpässe. Den meisten innovativen jungen Unternehmen gelingt es nicht, institutionelle Förderer oder Risikokapitalgeber für ihre Geschäftsidee zu gewinnen, weshalb das Wachstumspotential europäischer Startup-Unternehmen häufig nicht vollständig ausgeschöpft wird. Business Angels – private Investoren, die junge Unternehmen mit Kapital und Erfahrung unterstützen – könnten diese finanzielle Förderungslücke schließen und somit einen wichtigen Beitrag leisten, um die Innovationstätigkeit in Europa anzukurbeln. Über die Investitionstätigkeit von Business Angels in Europa ist derzeit allerdings relativ wenig bekannt. Dieser Policy Brief fasst aktuelle Forschungsergebnisse des Zentrums für Europäische Wirtschaftsforschung (ZEW) zusammen, beschreibt Entwicklungen im deutschen und europäischen Markt für Business Angels und diskutiert mögliche Maßnahmen, die darauf abzielen, die Entwicklung des Marktes für Investitionen durch Business Angels zu fördern

Die Rolle der Innovationsförderung im Aufholprozess Ostdeutschlands

Der Beitrag untersucht die Effektivität der Innovationsförderung in den neuen Ländern. Dabei wird ein doppelter Vergleich angestellt. Zum einen analysieren wir die Auswirkungen der Förderung hinsichtlich der FuE-Anreize und der FuE-Ergebnisse durch einen Vergleich von geförderten und nicht-geförderten Unternehmen. Zum zweiten vergleichen wir die Effekte der Förderung in den neuen Ländern mit den Effekten der FuE-Förderung in den alten Ländern. Untersucht wird mit evaluationsökonometrischen Methoden die Anreizwirkung der staatlichen FuE-Förderung auf die private Innovationstätigkeit. Zudem werden Zähldatenmodelle zur Schätzung von Innovationsproduktionsfunktionen eingesetzt, um zu untersuchen, ob Effizienzunterschiede zwischen öffentlich geförderten und eigenfinanzierten FuE-Projekten nachweisbar sind. Es zeigen sich sowohl in Ost- als auch in Westdeutschland positive Effekte der Innovationsförderung. In Ostdeutschland sind die geschätzten Anreizeffekte auf den FuE-Input größer als im Westen. Die Analyse der Patentaktivitäten der Unternehmen ergibt, dass die durch die Förderung induzierte FuE auch positive Innovationsoutputeffekte hat. Jedoch ist die Produktivität der geförderten FuE etwas geringer als diejenige der eigenfinanzierten FuE. Diese Ergebnisse deuten auch darauf hin, dass die FuE-Produktivität in den neuen Ländern geringer ist als in den alten Ländern