Impact of Competition and Entry on Innovation Inputs and Outputs – A comparative study using micro-data for selected EU countries and Japan
Impact of Competition and Entry on Innovation Inputs and Outputs – A comparative study using micro-data for selected EU countries and Japan
Innovation is widely considered to be a key long-term driving force for economic growth. Hence, stimulating business innovation is attached a high importance on the political agenda. Government policies can actually take two main routes: they can either directly trigger innovation, for instance by granting subsidies or by public procurement; or they can affect the framework conditions in which firms operate, aiming to make them more favourable to innovation. Among the latter, the intensity and type of competition are major factors. Government policies aiming to increase firm’s innovation propensity by changing framework conditions have to take possible interdependencies between the degree of competition, productivity and innovation into account. From a theoretical point of view, however, the relationship between competition on the one hand and innovation and productivity on the other hand is not clear-cut.Thus, the proposed project will carry out empirical research contributing significantly to the research on (i) the relationship between different types of competition (domestic vs. foreign competition, market vs. technological competition, various market structures) and innovation and (ii) the relationship between firms’ growth and innovation. Since this project will be carried out in cooperation with both EU and Non-EU countries, e. g. Australia, Canada, Netherlands, Sweden, Belgium and Japan it provides the opportunity to overcome the limitation of existing studies mostly using data from the US or the UK. This project is embedded into the OECD innovation strategy and the OECD network which assures the extensive harmonization of both the data as well as the methodological procedure.
