Abstract
The empirical tradition of Schumpeterian studies of the relation between innovation on the one hand and firm size and market structure on the other is linked with a theoretical tradition in which R&D is modeled as a stochastic race in which the winner takes all. Industry effects are taken into account on the basis of a classification introduced by Pavitt in 1984. The empirical study compares results on a survey of Dutch industry with results on a survey of American industry. For both data bases small firms are concluded to be more R&D-efficient in all Pavitt classes, except Science Based industry.
The research reported on is funded by the Netherlands Organization for Scientific Research (NWO) under filenumber 450-227-018. We have made use of the 1988 data base on innovation in the Dutch industry of the University of Amsterdam Foundation for Economic Research (SEO), which was funded by the Netherlands Ministery of Economic Affairs.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
References
Acs, Z. and Audretsch, D. (1989) ‘R&D, Firm Size and Innovative Activity’, Paper presented at the EARIE-conference, Budapest.
Acs, Z. and Audretsch, D. (1990) Innovation and Small Firms, Cambridge, The MIT Press.
Archibugi, D., Cesaratto, S. and Sirilli, G. (1991) ‘Sources of Innovative Activities and Industrial Organization in Italy’, Research Policy 20, 299–313.
Baldwin, W.L. and Scott, J.T. (1987) Market Structure and Technological Change, Chur, Harwood.
Bozeman, B. and Link, A.N. (1983) Investments in Technology: Corporate Strategies and Public Policy Alternatives, New York, Praeger.
Cohen, W.M. and Levin, R.C. (1989) ‘Empirical Studies of Innovation and Market Structure’, in R. Schmalensee and R.D. Willig (eds), Handbook of Industrial Organization, Volume II, Amsterdam, North-Holland.
Dasgupta, P. and Stiglitz, J. 11980) ‘Uncertainty, Industrial Structure and the Speed of RD’, Bell Journal of Economics 11, 11–28.
Dasgupta, P. and Stiglitz, J. 11981) ‘Entry, Innovation, Exit’, European Economic Review 15, 137–158.
Hamberg, D. (1966) RD: Essays on the Economics of Research and Development, New York, Random House.
Harabi, N. (1989) ‘Role of Patents in Theory and Practice: Empirical Evidence from Switzerland’, Paper presented at the EARIE-conference, Budapest.
Horowitz, I. (1962) ‘Firm Size and Research Activity’, Southern Economic Journal 28, 298–301.
Judge, G.G., Griffiths, W.E., Hill, R.C., Lütkepohl, H. and Lee, T.C. (1985) The Theory and Practice of Econometrics, Second Edition, New York, Wiley.
Kamien, M.I. and Schwarz, N.L. (1982) Market Structure and Innovation, Cambridge, Cambridge University Press.
Kleinknecht, A.H., Reijnen, J.O.N. and Verweij, J.J. (1990) Innovatie in de Nederlandse Industrie en Dienstverlening, Den Haag, Ministerie van Economische Zaken.
Kleinknecht, A.H. and Reijnen, J.O.N. (1991) ‘More Evidence on the Undercounting of Small Firm RD’, Research Policy 20, 579–587.
Lee, T. and Wilde, L.L. (1980) ‘Market Structure and Innovation: A Reformulation’, Quarterly Journal of Economics 94, 429–436.
Loury, G.C. (1979) ‘Market Structure and Innovation’, Quarterly Journal of Economics 93, 395–410.
Nooteboom, B. (1991) ‘Entry, Spending and Firm Size in a Stochastic RD Race’, Small Business Economics 3, 103–120.
Pavitt, K. (1984) ‘Sectoral Patterns of Technical Change: Towards a Taxonomy and a Theory’, Research Policy 13, 343–373.
Philips, L. (1971) ‘Research’, Chapter 5 in Effects of Industrial Concentration: A Cross-Section Analysis for the Common Market, Amsterdam, North-Holland, 119–142.
Rosenberg, J.B. (1976) ‘Research and Market Share: A Reappraisal of the Schumpeter Hypothesis’, Journal of Industrial Economics 25, 101–112.
Rothwell, R. (1985) Innovation and the Smaller Firm, First International Technical Innovation and Entrepreneurship Symposium, Utah Innovation Foundation, Salt Lake City.
Scherer, F.M. (1965) ‘Firm Size, Market Structure, Opportunity and the Output of Patented Inventions’, American Economic Review 55, 1097–1125.
Scherer, F.M. (1967) ‘Market Structure and the Employment of Scientists and Engineers’, American Economic Review 57, 524–531.
Scherer, F.M. (1980) Industrial Market Structure and Economic Performance, Second edition, Chicago, Rand McNally.
Schumpeter, J.A. (1942) Capitalism, Socialism and Democracy, New York, Harper.
Shrieves, R. (1978) ‘Firm Size and Innovation: Further Evidence’, Industrial Organization Review 4, 26–33.
Williams, O.E. (1965) ‘Innovation and Market Structure’, Journal of Political Economy 73, 67–73.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 1995 Springer Science+Business Media Dordrecht
About this chapter
Cite this chapter
Nooteboom, B., Vossen, R.W. (1995). Firm Size and Efficiency in R&D Spending. In: van Witteloostuijn, A. (eds) Market Evolution. Studies in Industrial Organization, vol 20. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-8428-9_5
Download citation
DOI: https://doi.org/10.1007/978-94-015-8428-9_5
Publisher Name: Springer, Dordrecht
Print ISBN: 978-90-481-4523-2
Online ISBN: 978-94-015-8428-9
eBook Packages: Springer Book Archive