Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

A Member of the Law Professor Blogs Network

Wednesday, December 1, 2010

Competition and Innovation: ICT- and non-ICT-enabled Product and Process Innovations

Posted by D. Daniel Sokol

Daniel Nepelski (European Commission) explains Competition and Innovation: ICT- and non-ICT-enabled Product and Process Innovations.

ABSTRACT: The reason for contradictory predictions of the models studying the impact of competi¬tion on innovation is the varying assumptions with respect to competition or innovation type. Thus, we study how the impact of competition changes with different types of innova¬tive Output. In particular, we distinguish between non-ICT - and ICT-enabled product and process innovations. To allow for such flexibility, we apply Bayesian inference techniques and use direct measures of innovative that control for the heterogeneity of innovation Output. Our analysis provides evidence that supports the hypothesis that the effect of market com¬petition on innovation is not alike for all types of innovation. We observe an inverse U-shape relationship between competition and non-ICT-enabled and a clear U-shape dependency for ICT-enabled innovations. However, the results become considerably weaker, once industry effects are taken into account.! Thus, although the impact of competition on innovation varies with the type of innovation, other factors seem to have a stronger impact on the incentives to innovate.

http://lawprofessors.typepad.com/antitrustprof_blog/2010/12/competition-and-innovation-ict-and-non-ict-enabled-product-and-process-innovations.html

| Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef0133f5c21ccc970b

Listed below are links to weblogs that reference Competition and Innovation: ICT- and non-ICT-enabled Product and Process Innovations:

Comments

Post a comment