Does competition increase or decrease the innovation gap between the best and the rest?
Abstract:
In this paper, we analyse whether competition increases or decreases inequality in innovation performance. We use firm panel data from ten waves of the Swiss Innovation Survey covering the period 1996-2019. Based on a recentered influence function (Firpo, Fortin and Lemieux 2009), we find that competition has a particularly large effect on firms that start to innovate and a small effect on firms at the top of the distribution. This reduces the overall inequality in innovation performance of innovators (intensive margin), but increases the difference between non-innovators and innovators (extensive margin). Furthermore, our estimates show that inequality in R&D investment leads to inequality in innovation performance and also has a negative impact on average innovation performance.
About Martin Woerter:
Martin Woerter is head of the Innovation Division at ETH Zurich, KOF Swiss Economic Institute and adjunct professor at the Department of Management, Technology and Economics at ETH Zurich. His research focuses on the field of innovation economics including topics related to environmental innovations, digitalization of the economy, and knowledge and technology transfer. Before coming to ETH Zurich, he worked at WIK (Scientific Institute for Communication Services) in Germany, at the Academy of Sciences in Vienna and at the University of Innsbruck. As part of his PhD he also conducted research at SPRU (Science and Technology Policy Research) in Brighton (England) and at the University of Marburg (Germany). He is also a Research Associate at the ZEW Leibniz Centre for European Economic Research in Mannheim.
Language: English
This is a free seminar. Registration is mandatory.
Supported by the Luxembourg National Research Fund (FNR) 17931929