Comparison of Localisation Motives for R&;D Investment of Multinational Enterprises in the New and Old EU Member Regions

The issue of localisation motives is one of the key topics in attracting and motivating MNEs to establish or enhance their R&D activities abroad. The paper aims to compare localisation motives for R&D investment of multinational enterprises in the new and old EU member regions and to find out main localization motives differences among them. We have found out the key motives were technology/supply side factors, which strongly influence decision-making at MNEs in locating and maintaining R&D in all regions. In the more developed regions, the localisation is positively influenced also by the presence of other important/large (high-tech) companies and important universities in the region, which provide relevant services to MNEs. Localisation decisions in the new EU member regions were positively influenced particularly by presence of a quality and cheap labour force and a suitable R&D infrastructure and experience in R&D in these regions. Considerable differences between the old and new EU member states reflects their distinctive economic history, recent re-opening of their economies and consequences of the process of post-communist transition.     

Women Underrepresentation in R&I: A Sector Program Assessment of the Contribution of Gender Equality Policies in Research and Innovation

Despite decades of efforts to achieve gender equality in research and innovation (R&I), all EU member states still face remarkable difficulties in driving forward the development of their innovation system while at the same time improving gender equality by using all the available research potential. In this paper we focus on the development of the share of women researchers in four national innovation systems, i.e. in Austria, Denmark, Hungary and Spain in the time period 2005-2015. The four selected cases represent countries with significant differences in their innovation capacity, gender regimes and progress of gender equality in R&I. A qualitative comparative analysis (QCA) is carried out to conduct a sector program evaluation based on statistical data and qualitative studies to understand the dynamic development of the proportion of women researchers. The study aims to provide insights into the aggregated gender equality interventions and policies implemented in the four countries studied and their contributions to the development of the proportion of women scientists at the structural level. The analysis reveals that the development of the share of women researchers during the studied period has been particularly influenced by contextual factors, namely the relative size of the business enterprise sector and the share of women among holders of tertiary education. While this is the case, it is found that gender equality interventions need to be more widespread and more effectively designed to be a strong contributing factor to an increasing representation of women in R&I.     

Defense Industry Restructuring: Trends in European and U.S. Defense Companies

The national defense industries have recognized that world circumstances have changed and consequently some radical changes are also required in their own structures. Increased concentration of defense production indicates that the central defense-industrial policy dilemma between the benefits of economies of scale and the benefits of competition has gradually been resolved in favor of scale economies. This article analyses the restructuring underway from a political-business perspective. It compares the different forms of corporate linkage ranging from full merger and takeover via less dramatic ties associated with strategic alliances and minority shareholdings to joint ventures. In particular, it explores these approaches from the perspective of their suitability to restructuring in the politically sensitive defense industry when the process spans national boundaries. The structure of the analysis involves an assessment of the progress of the U.S. defense industry and identification of the drives for change and the underlying dynamics of this industry. This gives a platform for a parallel analysis of pressures and changes among the European defense industry, leading to an analysis of how U.S. and European companies are placed regarding the industrial trends towards globalization.     

Evaluation of technological competence and operations efficiency in the defense industry: The strategic planning of South Korea

This research aims to contribute to efficiency improvement by providing the implications for decision-making on continuous defense R&D investment strategies and acquisition methods via analyzing the current position and measuring the efficiency of overall weapon systems on technological competence and operations. This research is distinctive in comparison to previous studies because it is structured in a two-stage DEA analysis for efficiency by distinguishing between the technology and operations of the current eight fields of weapon systems and by adding the external index for government competence and market competence. In 2016, in comparison to the year 2013, the eight major weapon systems’ efficiency fields of the overall system of Korea, efficiency of technological competence, and efficiency of operations all increased. This research introduced the input and output variable that fits in with the defense industry by connecting the weapon systems efficiency with the national innovation system and the sectoral innovation system that are both projected in this industry. It also formed the concepts of technological competence efficiency and operations efficiency using the two-stage Network DEA method.     

Corporate social responsibility driven innovation

This study identifies the substantial relationship between corporate social responsibility (CSR) and innovation activities of firms. Using the French Vigeo sustainability rating and the Thomson Reuters, we divided 619 firms into groups by their industry sectors, regions, and firm characteristics such as size and age. We premise that innovative investment is needed to prepare tomorrow's profits not only by considering investments in technology and in R&D, but also by dealing with sustainability to human, social, environmental, technical, and economic investments. Consequently, when the firm manipulates its short- and long-run business strategies, the consideration of the correlation between types of investment and CSR initiatives will lead to more cooperating effect on the outcome of investments. The findings provide a comprehensive understanding on the effect of sustainable management strategies on the innovation and sustainability of firms.     

What are the likely interactions among innovation,government debt,and employment?

The study here analyzes the interactions among labor, R&D intensity, and public expenditure on education (indicators of innovation), considering public debt of countries. The study is based on 27 European countries over the 1995–2009 and applies multiple regression analysis. Main findings seem to be: a significant interaction of public expenditure on education and R&D intensity with employment rate, whereas an increase of general government consolidated gross debt has a negative interaction for employment rate as well as for technology indicators. The theoretical framework and empirical evidence suggest vital political economy implications to support employment rate during contractions of the business cycle. In particular, considering the specificity of the economic structure of countries, a fruitful lung-run political economy of growth should slowly dry out public debt by supporting GDP growth, rather than reducing government debt with high taxation and balanced-budget rules, in order to decrease frictional effects for patterns of economic, technological, and employment growth.     

The dual role of R&D expenditures in European Union’s member states: short- and long-term prospects

The objective of this article is to assess a potential dual role of public expenditures in R&D upon economic growth and employment, using these dimensions as partial representations of the socioeconomic state of affairs in European Union’s Member States. First, we look into direct, short-term impacts arising from R&D expenditures, much in the sense of a multiplier effect. Second, we analyse impacts from the stage of development of National Innovation Systems (NIS) upon the macroeconomic conditions of interest, assuming that current stages of development are products of previous commitment to innovation, that is, a structural, long-term outcome of innovation-oriented investments. In order to empirically test our propositions, we have analysed 28 EU Member States (1990–2013) through three sets of econometric (static and dynamic panel data) models. Results highlight that EU countries’ governmental commitment to their respective innovation systems catalyses current and prospective economic growth and employment levels, suggesting a complementarity between Neo-Schumpeterian and Neo-Keynesian perceptions over governmental R&D involvement. This can bring innovation efforts closer to the macroeconomic debate on monetary and fiscal policies and function as a criticism to austerity measures, as this may not only affect the present socioeconomic situation, but also generate the cornerstone for a perennial state of divergence among EU Member States.     

Measuring the Role of Central and Eastern European Countries in World Drug Research

This paper explores the sociological behavior of firms in the pharmaceutical industry in Central and Eastern Europe as measured by funding linkages. Using the ISI Web of Science data-base, the number of research papers funded by top American and European pharmaceuticals with at least one author from Central and Eastern Europe are identified. Results indicate that Poland leads in the region by both the number of papers funded and by percentage of a firm’s total papers funded, followed closely by Hungary, Greece and the Czech Republic. Though the percentages of any firm’s linkages with a Central and Eastern European author are small (upper limit being 6.6%), this percentage is skewed due to the fact that the US is cited for 50% of papers for most firms. Roche Corporation is the top funder of papers among both US and European firms. Incidentally, zero top American pharmaceuticals were found to have an R&D center located in Central and Eastern Europe whereas European firms: GlaxoSmithKline and Sanofi-Aventis do—possibly indicating a difference in business strategy between European and American pharmaceuticals.     

Building Social Capability for Economic Catch-up: The Experience and Prospects of the Post-socialist Countries

The post-socialist countries are, by the standards of the EU, poor countries. The major developmental task facing these countries is, therefore, that of catching up with their more prosperous neighbours. The scope for catch-up is defined in terms of the levels of social capability exhibited by these societies and their capacity to establish technological congruence with the leading firms from the advanced industrial economies. S&T systems in the broadest sense are shown to be key factors in relation to both social capability and technological congruence. Detailed analysis of the transition countries indicates that the catch-up process is hampered across the board by specific gaps in social capability and elements of technological incongruence. These can in turn be traced to specific structural trends, in particular in relation to foreign investment, and to specific weaknesses of institutional development, cutting across the public/private dividing line, notably in relation to R&D systems and banking systems. Consideration of all these factors suggests that there can be no assumption that the transition countries will automatically catch up with western Europe, and that some disfavoured transition countries may, indeed, continue to fall behind.     

U.S. unionism and R&D investment: Evidence from a simple cross-country test

This paper implements Freeman’s suggestion that insights into the effect of U.S. unionism on R&D investment may be obtained by correlating U.S. union density by industry with R&D investment by industry in another country, here Germany.     

Measuring relative efficiency of government-sponsored R&D projects: A three-stage approach

Without considering differences in operating environment, traditional methods of efficiency evaluation are suffering from external environmental influences. This study presents an alternative approach for assessing the relative efficiency of government-sponsored research and development projects (GSP). A three-stage approach employing data envelopment analysis to evaluate efficiency and Tobit regression to control external variables was applied to 110 projects over 9 years. This study finds that firm size, industry, and ratio of public subsidy on research and development (R&D) budget of recipient firm significantly influences the technical efficiency of GSP in Taiwan. After controlling these external variables, the mean value of technical efficiency in the third stage increases and becomes significantly different to that in the first stage. Most GSPs increase their returns when their projects are scaled up. Furthermore, government policy makers must establish the upper-limit ratio of subsidies on R&D budgets of recipient firms to avoid inefficient use of public funds.     

ASSET PRICE BUBBLES AND TECHNOLOGICAL INNOVATION

We introduce borrowing constraints into a two‐sector Schumpeterian growth model and examine the impact of asset price bubbles on innovation. In this environment, rational bubbles arise when the intermediate good producing R&D sector is faced with adverse productivity shocks. Importantly, these bubbles help alleviate credit constraints and facilitate innovation in the stagnant economy. On the policy front, we make a case for debt financed credit to the R&D sector. Further, we establish that a constant credit growth rule (akin to the Friedman rule) outperforms the often prescribed counter‐cyclical “lean against the wind” credit policy. (JEL E32, E44, O40)     

Enterprise policy evaluation: is there a 'new' way of doing it?

Given that most economies are now in recession, policymakers are looking to small firms to act as engines of economic growth; this has led to a revived interest in the role of enterprise policy. The 'new' enterprise policy is systemic, promoting and shaping externalities and capabilities. At its core are R&D, innovation and education. It encapsulates a shift from direct intervention towards creating an enabling environment for small firms and entrepreneurship. At present there is a research lacuna regarding the evaluation of such policies. The aim of this paper is to fill this gap by making two key contributions. First, I demonstrate that traditional enterprise evaluation metrics are too narrow: they focus almost exclusively on private firm impacts, rather than broader societal impacts caused by the pervasive nature of 'new' enterprise policies. Second, I illustrate how logic models could be expanded to account for these broader impacts.     

Should “open innovation” change innovation policy thinking in catching-up economies? Considerations for policy analyses

This paper provides a review of the current state of academic and policy-level debates on “open innovation” by elaborating on the relevance of the concept of open innovation for innovation policy-making in catching-up economies. The paper shows that paradoxes and contradictions exist between the “mainstream” innovation discourse and the development challenges of the catching-up countries that have lead to “de-contextualization” of the innovation policy discourse. The paper argues that applying the concept of open innovation in its ideal-type form to the catching-up context is likely to reinforce these de-contextualization tendencies. This problem can be remedied by more conscious attention to the basic contradictions and paradoxes, which requires a more comprehensive and systemic analytical focus on innovation and technological development at the levels of firm, industry and policy.     

Structural equation model for the evaluation of national funding on R&D project of SMEs in consideration with MBNQA criteria

Financial support on the R&D in Science & Technology for SMEs at the governmental level plays a crucial role on the improvement of the national competitiveness. Korea Science & Engineering Foundation (KOSEF) has supported the R&D projects of SMEs with the competitive technology ability by way of the Science and Technology Promotion Fund. In this paper, we propose a structural equation model (SEM) to evaluate the performance of such a funding program in terms of three aspects: output, outcome and impact under given funding inputs, R&D environment of a recipient company, and external evaluation programs of funding organization. We adopt Malcolm Baldrige National Quality Award (MBNQA) criteria to assess the R&D environmental factors of recipient companies. In addition, we test the effect of interim evaluation of the funded project. The proposed model is applied to the real case and is used to identify the best practices as well as to provide feedback information for the improvement of the government funding programs of the R&D projects of SMEs.     

Unions and innovative activity in Germany

This study is the first attempt to investigate the influence of unions on innovative activities in Germany at the industry level. Econometric models estimated by a highly robust method and submitted to a number of specification tests indicate that trade unions do not have a negative impact on innovative activity which is measured by either the percentage of revenues spent on R&D or the percentage of employees working in R&D. This finding is consistent with evidence on the influence of unions on productivity in Germany and with considerations about the German system of industrial relations.     

Social capital and innovation dynamics in district-based local systems

The idea behind this paper is that social capital (SC) is interpreted as a component of an investment, which implies entangled private and public benefits. Within a theoretical framework that considers SC as the public component of the impure public good R&D we show that the ‘civic culture’ of the district in which a firm is located is not a sufficient incentive for the firm to increase its investment in SC, because SC/networking dynamics might positively and complementarily evolve only if the opportunity cost of investing in innovation is sufficiently low. Consequently, we focus our attention on a specialised biomedical industrial district characterised by a strong pattern of innovative activity. We observe that R&D and networking/social capital arise as complementary driving forces of innovation outputs. When the empirical evidence confirms that this complementarity plays a key role, policy efforts should be targeted toward both market and non-market characteristics, rather than solely to the production of local public goods or innovation inputs as independent elements of firm performance. This is very important in terms of policy effectiveness. In fact, we argue that SC/networking dynamics might positively evolve only if the private opportunity cost of investing in R&D innovation is sufficiently low. Nevertheless, this exogenous economic incentive works as long as complementarity, as defined here, holds.     

Innovation Propensity in the EU Candidate Countries

Innovation activities in transition economies generally lag behind developed economies. This is also the case in the latest group of EU candidate countries whose innovation performance lags behind EU-27 average. In this paper we analyze the innovation propensity of firms in EU candidate countries (Croatia, FYR Macedonia, Montenegro and Turkey). The analysis relies on the Business Environment and Enterprise Performance Survey (BEEPS 2009) data. By employing probit model we have identified determinants of innovation propensity in analyzed countries. The results point to external factors such as the subsidies, customer pressure to innovate, obstacles from high tax burdens, political instability and inadequate education of workforce as significant positive predictors. Based on the results, few innovation policy recommendations are proposed.     

国际大都市科技创新特点及其对上海的启示

科技企业作为上海经济快速发展的生力军,其研发水平的大力提升将有效实现产业转型与技术升级.与纽约科技创新、东京小微企业发展、伦敦的创新氛围以及巴黎竞争簇群相比,上海需要适度调整引资政策,改变外资独大的局面;减小单纯追求研发人员数量的增长,改变过度依赖引进技术的格局,真正走出一条自主创新之路.     

Technology audit as a policy instrument to improve innovations and industrial competitiveness in countries in transition

Sustained economic growth in Central and Eastern European Countries depends, among other factors, on a radical technical restructuring. The instrument of technology audit supports policy makers in designing appropriate strategies for shaping science and technology policies in this process. The conceptual part of the article outlines the methodology for the analysis of strengths and weaknesses of R&D systems and future areas of competitiveness, which can be transferred also to other countries in periods of intense technological development. This approach is based on international best practice of evaluation research and practical experiences in the transition context. The empirical part outlines main findings of a technology audit in the field of biotechnology in Hungary.