Working Paper: CEPR ID: DP4021
Authors: Rene Belderbos; Martin A. Carree; Bert Diederen; Boris Lokshin; Reinhilde Veugelers
Abstract: We explore heterogeneities in the determinants of innovating firms? decisions to engage in R&D cooperation, differentiating between three types of cooperation partners: suppliers and customers (vertical cooperation), competitors (horizontal cooperation), and universities and research laboratories (institutional cooperation). We use panel data on innovating firms drawn from two Dutch Community Innovation Surveys in 1996 and 1998. Applying a system method estimator for probit equations shows significantly positive correlations between the different cooperation decisions, suggesting that R&D cooperation strategies are complements rather than substitutes. We find that the determinants of R&D cooperation differ significantly and substantially across cooperation types. As suggested by industrial organization theory of R&D cooperation, the effects of spillovers depend on their source: while horizontal spillovers have ambiguous effects on horizontal cooperation, vertical spillover positively impact vertical cooperation and institutional spillovers significantly impact all types of cooperation. The results are largely robust to correction for potential simultaneity bias.
Keywords: R&D cooperation; spillovers; innovation; industrial organization
JEL Codes: L13; O30; O32; O34
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| vertical incoming spillovers (F12) | vertical cooperation (L14) |
| institutional incoming spillovers (F55) | institutional cooperation (F55) |
| horizontal incoming spillovers (F69) | horizontal cooperation (L22) |
| R&D intensity (O32) | vertical cooperation (L14) |
| R&D intensity (O32) | institutional cooperation (F55) |
| firm size (L25) | vertical cooperation (L14) |
| firm size (L25) | horizontal cooperation (L22) |
| firm size (L25) | institutional cooperation (F55) |
| organizational capability constraints (D20) | vertical cooperation (L14) |
| organizational capability constraints (D20) | institutional cooperation (F55) |
| commercial risk constraints (G32) | horizontal cooperation (L22) |
| speed of technological change (O33) | horizontal cooperation (L22) |
| speed of technological change (O33) | institutional cooperation (F55) |
| R&D subsidies (O38) | vertical cooperation (L14) |
| R&D subsidies (O38) | institutional cooperation (F55) |