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Identifying technology spillovers and product market rivalry

Bloom, Nick, Schankerman, Mark and Van Reenen, John (2007) Identifying technology spillovers and product market rivalry. NBER working paper, 13060. National Bureau of Economic Research, Cambridge, MA, USA.

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Abstract

Support for R&D subsidies relies on empirical evidence that R&D "spills over" between firms. But firm performance is affected by two countervailing R&D spillovers: positive effects from technology spillovers and negative business stealing effects from R&D by product market rivals. We develop a general framework showing that technology and product market spillovers have testable implications for a range of performance indicators, and then exploit these using distinct measures of a firm's position in technology space and product market space. Using panel data on U.S. firms between 1980 and 2001 we show that both technology and product market spillovers operate, but technology spillovers quantitatively dominate. The spillover effects are also present when we analyze three high tech sectors in finer detail. Using the model we evaluate the net spillovers from three alternative R&D subsidy policies.

Item Type: Monograph (Working Paper)
Official URL: http://www.nber.org
Additional Information: © 2007 Nicholas Bloom, Mark Schankerman, and John Van Reenen.
Library of Congress subject classification: T Technology > T Technology (General)
H Social Sciences > HD Industries. Land use. Labor
Journal of Economic Literature Classification System: O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O31 - Innovation and Invention: Processes and Incentives
O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O33 - Technological Change: Choices and Consequences; Diffusion Processes
O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O32 - Management of Technological Innovation and R&D
L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance
F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms; International Business
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Research centres and groups > Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD)
Departments > Economics
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 13060
Funders: ESRC
Date Deposited: 27 May 2008 15:03
URL: http://eprints.lse.ac.uk/5091/

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