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Innovation and R&D

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nanoecon posted on Mon, Jun 7 2010 8:43 AM

Does anyone know of a "good" and detailed source of information on the contribution of innovation (along the lines of what is measured by R&D spending) to economic growth?  Looking for a something that differentiates between basic and applied R&D too.

Much thanks to anyone that has knowledge to share about this.

 

JM

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I have what you need:
http://books.google.com/books?id=tLuqjIVJUcoC&printsec=frontcover&dq=Endogenous+Growth+Theory&hl=en&ei=rGQOTOmMJYG8lQfaqbhs&sa=X&oi=book_result&ct=book-thumbnail&resnum=1&ved=0CCkQ6wEwAA

Aghion and Howitt's textbook on endogenous growth theory is very interesting (if dense) read. 

They discuss theoretical models and empirical evidence.

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Some of those things are mentioned in here:

The Myth of Science as a Public Good (by Terence Kealey)
http://www.youtube.com/watch?v=C_PVI6V6o-4

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I remember Jeffrey Tucker talking about how the Wright brothers made a small adjustment to their plane and then went and patented it. After that went suing a bunch of people for many years. He also talked about the Cotton Gin and Eli Whitney and how the Gin was invented way before him; all he did was patent it. Are there any books on patents, copyrights, and trademarks, that lay out this type of information? Specifically the history of it all.

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I have what you need:
http://books.google.com/books?id=tLuqjIVJUcoC&printsec=frontcover&dq=Endogenous+Growth+Theory&hl=en&ei=rGQOTOmMJYG8lQfaqbhs&sa=X&oi=book_result&ct=book-thumbnail&resnum=1&ved=0CCkQ6wEwAA

Aghion and Howitt's textbook on endogenous growth theory is very interesting (if dense) read. 

They discuss theoretical models and empirical evidence.

Ambition is a dream with a V8 engine - Elvis Presley

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Thanks.  I will look into endogenous growth theory. 

Has anyone tried to place R&D / innovation into the Austrian framework?  I am not talking about IP.  I am interested in the outputs of R&D spending and how does R&D contribute to economic growth. 

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Student replied on Mon, Jun 14 2010 11:08 AM

Well, the best Austrian work on innovation probably goes back to Schumpeter (The Theory of Economic Development is a good place to start). 

I am not sure if there are any Austrians currently working on this topic. Someone else might be able to point you toward any if they exist. 

Ambition is a dream with a V8 engine - Elvis Presley

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"Are Internal Capital Markets Good for Innovation?" by Peter Klein

Abstract: Which type of firm is more innovative: the decentralized, diversified corporation or the smaller, more narrowly focused “entrepreneurial” firm? According to one argument, diversi- fied corporations can do more R&D because their operating units have access to an internal capi- tal market. Other writers argue that decentralized, diversified firms over-rely on financial ac- counting criteria to evaluate the performance of their operating units, discouraging divisional managers from investing in projects like R&D with long-term, uncertain payoffs. This paper uses a comprehensive sample of diversified and nondiversified firms from 1980 to 1999 to study the relationship between diversification and innovation. I find a robust negative correlation between diversification and R&D intensity, even when controlling for firm scale, cash flow, and invest- ment opportunities. Industry-adjusted R&D—the difference between the R&D intensity of a di- versified firm and the R&D intensity it would most likely have if its divisions were standalone firms—is negative, consistent with the hypothesis that diversification reduces innovation by dis- couraging R&D investment. However, other evidence suggests that internal-capital-market inef- ficiencies, rather than managerial myopia, are driving the negative relationship between diversi- fication and innovation.

"the obligation to justice is founded entirely on the interests of society, which require mutual abstinence from property" -David Hume
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