Absorptive Capacity, R&D; Spillovers and Public Policy.
Empirical evidence strongly suggests that R&D; increases a firm's 'absorptive capacity' (its ability to absorb spillovers from other firms) as well as contributing directly to profitability. We explore the theoretical implications of this. We specify a general model of the abs...
| Main Authors: | , |
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| Format: | Working paper |
| Language: | English |
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CEPR
2004
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| _version_ | 1797087756958040064 |
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| author | Leahy, D Neary, J |
| author_facet | Leahy, D Neary, J |
| author_sort | Leahy, D |
| collection | OXFORD |
| description | Empirical evidence strongly suggests that R&D; increases a firm's 'absorptive capacity' (its ability to absorb spillovers from other firms) as well as contributing directly to profitability. We explore the theoretical implications of this. We specify a general model of the absorptive capacity process and show that costly absorption both raises the effectiveness of own R&D; and lowers the effective spillover coefficient. This weakens the case for encouraging research joint ventures, even if there is complete information sharing between its members. It also implies an additional strategic pay-off to policies that raise the level of extra-industry knowledge. |
| first_indexed | 2024-03-07T02:40:14Z |
| format | Working paper |
| id | oxford-uuid:aa3148bf-0766-4fa2-b8d2-fe29968bd54f |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T02:40:14Z |
| publishDate | 2004 |
| publisher | CEPR |
| record_format | dspace |
| spelling | oxford-uuid:aa3148bf-0766-4fa2-b8d2-fe29968bd54f2022-03-27T03:13:30ZAbsorptive Capacity, R&D; Spillovers and Public Policy.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:aa3148bf-0766-4fa2-b8d2-fe29968bd54fEnglishDepartment of Economics - ePrintsCEPR2004Leahy, DNeary, JEmpirical evidence strongly suggests that R&D; increases a firm's 'absorptive capacity' (its ability to absorb spillovers from other firms) as well as contributing directly to profitability. We explore the theoretical implications of this. We specify a general model of the absorptive capacity process and show that costly absorption both raises the effectiveness of own R&D; and lowers the effective spillover coefficient. This weakens the case for encouraging research joint ventures, even if there is complete information sharing between its members. It also implies an additional strategic pay-off to policies that raise the level of extra-industry knowledge. |
| spellingShingle | Leahy, D Neary, J Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title | Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title_full | Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title_fullStr | Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title_full_unstemmed | Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title_short | Absorptive Capacity, R&D; Spillovers and Public Policy. |
| title_sort | absorptive capacity r amp d spillovers and public policy |
| work_keys_str_mv | AT leahyd absorptivecapacityrampdspilloversandpublicpolicy AT nearyj absorptivecapacityrampdspilloversandpublicpolicy |