The Role of Demand in Fostering Product vs Process Innovation: A Model and an Empirical Test
28 May 2019, 12:00 pm–1:00 pm
This event is free.
Event Information
Open to
- All
Availability
- Yes
Cost
- Free
Organiser
-
CCSEE Seminar Series
Location
-
130Anthropology14 Taviton StreetLondonWC1H 0BW
While the extant innovation literature has provided extensive evidence of the so-called “demand-pull” effect, the possible diverse impact of demand evolution on product vs process innovation activities has not been yet investigated. This paper develops a formal model predicting a larger inducing impact of past sales in fostering product rather than process innovation. This prediction is then tested through a dynamic microeconometric model, controlling for R&D persistence, sample selection, observed and unobservable individual firm effects and time and sectoral peculiarities. Results are consistent with the model and suggest that an expansionary economic policy may benefit the diffusion of new products or even the emergence of entire new sectors.
About the Speaker
Prof. Dr. Marco Vivarelli
Director of the Department of Economic Policy at Università Cattolica del Sacro Cuore, Milano