TY - JOUR
T1 - Persistent heterogeneity of R&D intensities within sectors
T2 - Evidence and policy implications
AU - Coad, Alex
N1 - Funding Information:
Hernandez et al., 2016 ) Research and Development (R&D) investment in our dataset is the cash investment funded by the companies themselves. It excludes R&D undertaken under contract for customers such as governments or other companies. It also excludes the companies' share of any associated company or joint venture R&D investment. Being that disclosed in the annual report and accounts, it is subject to the accounting definitions of R&D. For example, a definition is set out in International Accounting Standard (IAS) 38 “Intangible assets” and is based on the “Frascati” manual of the OECD. Research is defined as original and planned investigation undertaken with the prospect of gaining new scientific or technical knowledge and understanding. Expenditure on research is recognised as an expense when it is incurred. Development is the application of research findings or other knowledge to a plan or design for the production of new or substantially improved materials, devices, products, processes, systems or services before the start of commercial production or use. Development costs are capitalised when they meet certain criteria and when it can be demonstrated that the asset will generate probable future economic benefits. Where part or all of R&D costs have been capitalised, the additions to the appropriate intangible assets are included to calculate the cash investment and any amortisation eliminated. Net sales follow the usual accounting definition of sales, excluding sales taxes and shares of sales of joint ventures & associates. For banks, sales are defined as the “Total (operating) income” plus any insurance income. For insurance companies, sales are defined as “Gross premiums written” plus any banking income. Operating profit is calculated as profit (or loss) before taxation, plus net interest cost (or minus net interest income) minus government grants, less gains (or plus losses) arising from the sale/disposal of businesses or fixed assets. Number of employees is the total consolidated average employees or year-end employees if average not stated. Appendix B
Funding Information:
I am grateful to Sara Amoroso, Flavio Calvino, Elena Cefis, Matthias Deschryvere, Giovanni Dosi, Andrea Filippetti, Nicola Grassano, Daniel Halvarsson, Heli Koski, Nanditha Mathew, Pietro Moncada-Paternò-Castello, Stephen Roper, Martin Srholec, Federico Tamagni, Alex Tuebke, Jan van den Biesen (Philips), Daniel Vertesy, Antonio Vezzani, and participants at the 6th IRIMA workshop (JRC-IPTS, European Commission, Brussels, Dec 2015), EMAEE 2017 in Strasbourg, and CONCORDi 2017 in Seville, as well as two anonymous reviewers and the editor, Stefan Kuhlmann, for helpful comments. The usual caveat applies.
Publisher Copyright:
© 2018 Elsevier B.V.
PY - 2019/2
Y1 - 2019/2
N2 - Do firms in the same sector converge towards the same R&D intensities? Previous research has often assumed this to be true. A closer examination, using microdata from the EU Industrial R&D Investment Scoreboard for the years 2000–2015, shows considerable heterogeneity in R&D intensities among firms in the same sector, and that this heterogeneity persists over time. Statistical tests of convergence show that the variation in R&D intensities does not decrease over time (i.e. no σ-convergence), although firms with an R&D intensity below the industry average do seem to catch up with the leaders (i.e. evidence of β-convergence). Overall, firms in the same industry do not converge to a common R&D intensity. Policy implications are discussed.
AB - Do firms in the same sector converge towards the same R&D intensities? Previous research has often assumed this to be true. A closer examination, using microdata from the EU Industrial R&D Investment Scoreboard for the years 2000–2015, shows considerable heterogeneity in R&D intensities among firms in the same sector, and that this heterogeneity persists over time. Statistical tests of convergence show that the variation in R&D intensities does not decrease over time (i.e. no σ-convergence), although firms with an R&D intensity below the industry average do seem to catch up with the leaders (i.e. evidence of β-convergence). Overall, firms in the same industry do not converge to a common R&D intensity. Policy implications are discussed.
KW - Benchmarking
KW - Convergence
KW - Evolutionary theory
KW - Heterogeneity
KW - R&D intensity
KW - R&D investment
KW - Sectoral systems of innovation
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U2 - 10.1016/j.respol.2018.07.018
DO - 10.1016/j.respol.2018.07.018
M3 - Article
AN - SCOPUS:85051381668
VL - 48
SP - 37
EP - 50
JO - Research Policy
JF - Research Policy
SN - 0048-7333
IS - 1
ER -