Transcript Class 2
Innovation Economics Class 2 Shifting Heuristics in the Economics of Innovation Area of specialization in microeconomic theory Industrial organization, regional economics, theory of the firm, microeconomics of growth Birth of this area of specialization is with the discovery of the residual Progressive reduction in the power of the technological change as an exogenous process: Metaphor of manna. Notion of technological opportunity Origins of the Economics of Innovation The concept of residual Economics of innovation concentrates on the problem of explaining at the firm level the process of growth of output whch cannot be explained by increases in production factors. Solow (1957) showed that more than 40% of growth in the US economy over 1900-1949 is due to factors other than the traditional categories of standart economics. Manna Metaphor Manna tradition of analysis introduces a linear sequence between scientific discoveries and technology innovations. Scientist .. İnvention … scientific knowledge … technological knowledge Kenneth Arrow (1962) showed that technical knowledge has public good characteristics: invisibility, non-excludability, nontradeability. Market provision of efficient level of public good?? Role of the government?? Analysis of technological change as an exogenous process Biological Grafts: Epidemics and Life Cycles Analysis of the delays in the adoption of given technology innovations Diffusion Time distribution of adoption Life cycle metaphor Major innovations and minor innovations Role of small firms Hypothesis: Large firms are necessary for high rates of technological advance to take place (size shapes innovativeness) Hypothesis: New firms are necessary for high rates of innovation (age shapes innovativeness) Trajectories and Tecnological Paths Three contributions from the philosophy of science: Tacit vs. codified knowledge Limits to rationality Entry of the notion of learning Learning, cumulative features of learning, individual learning, organizational learning Manna metaphor --- trajectories (Kuhn; scientific evolution) Endogenous innovations Localized knowledge Technologcal path dependence Local externalities Collective Learning and Networks Marshallian analysis Externalities Spillovers Knowedge interactions New Growth Theory Based on: Distinction between tacit and codified knowledge Understanding of technological externalities Notion of monopolistic competition as a result of introduction of new products Summary Manna --- Product life cycle and trajectories --network approach Key features of a national innovation system Education and training Industrial structure Scientific and technological capabilities S&T strengths and weaknesses Interactions among the various components of the innovation system Absorption from abroad All of which can be quantified Population in the USA, EU 25 and Japan Milions 500 400 300 200 100 0 USA EU Japan GDP in the USA, EU 25 and Japan 12000000 10000000 8000000 6000000 4000000 2000000 0 USA EU Japan R&D in the USA, EU 25 and Japan Milyonlar 0,3 0,25 0,2 0,15 0,1 0,05 0 USA EU Japan Scientific Papers in the USA, EU 25 and Japan 300000 200000 100000 0 USA EU Japan Internet Users in the USA, EU 25 and Japan 200000000 150000000 100000000 50000000 0 USA EU Japan R&D Intensity - 2001 From Lisbon to Barcelona Make of Europe the largest knowledge economy of the world Reach 3 per cent in the ration R&D/GDP Who has to pay for it? The business sector… which should contribute about 2/3 of the total expenditure Jan Tinbergen’s lesson: economic policy is about targets and instruments Where are the instruments? A pragmatic approach: the Kok Report How has Europe done in the last years? Patent data Mean annual Mean annual granted granted Mean annual Mean annual Mean annual Mean annual patents at patents at rate of applied patents applied patents rate of USPTO per USPTO per growth from at EPO per at EPO per growth from million people million people 1996-97 to million people million people 1996-97 to 2002-03 1997-1998 2000-01 2002-03 1997-1998 2000-01 USA Japan EU-15 EU-25 301 277 71 59 260 214 54 45 3,0% 5,3% 5,6% 5,7% 107 135 136 114 80 106 96 80 5,9% 5,1% 7,3% 7,4% How has Europe done in the last years? Bibliometric data Number of scientific publication in 2000-01 per million people USA Japan EU-15 EU-25 700 444 556 493 Number of scientific Mean annual rate of publication in 1995-96 growth from 1995-96 to per million people 2000-01 759 390 510 448 -1,6% 2,6% 1,7% 1,9% How has Europe done in the last years? ICT expenditure ICT ICT Mean annual expenditure expenditure rate of growth (% of GDP) (% of GDP) from 1996-97 2001-02 1996-97 to 2001-02 USA Japan EU-15 EU-25 7,2 7,5 6,5 6,5 7,7 6,9 5,7 5,6 -1,7% 2,2% 3,4% 4,1% Which S&T Policy for the EU? Typical problem of deepening and widening Widening: to privilege the diffusion of knowledge in the newcomers Deepening: develop areas of excellence