Paula Stephan, 20 March 2014

US universities resemble high-end shopping malls. They use nice buildings and good reputations to attract good students and good faculty. To pay for this, external funding – once viewed as a luxury – is a necessary condition for tenure and promotion. This column argues that this model emerged at the initiative of universities not the federal government. Today’s stress is the harvest of what universities and faculty sowed in the 1950s and the 1960s.

Theodore Moran, Lindsay Oldenski, 04 March 2014

The US has once again ranked among the top two recipient countries for foreign direct investment. This column examines the effects of these large FDI inflows on the US domestic economy. Foreign multinationals are – alongside US-headquartered American multinationals – the most productive and highest-paying segment of the US economy. In addition, they provide positive spillovers to US firms. About 12% of the total productivity growth in the US from 1987 to 2007 can be attributed to productivity spillovers from inward FDI.

Enrica De Cian, Samuel Carrara, Massimo Tavoni, 22 December 2013

After the Fukushima incident in 2011, many countries decided to shrink their nuclear power programmes. This article presents recent research on the optimal role of nuclear power in reducing carbon emissions. Phasing out nuclear power would be costly, since it is currently the cheapest low-carbon alternative to fossil fuels. However, these costs would be largely offset by the implicit subsidy to R&D in renewables, which suffers from innovation externalities. Still, carbon pricing and explicit R&D subsidies would be a more efficient way of determining the future of nuclear power.

Theodore Moran, Lindsay Oldenski, 31 October 2013

Criticism of 'offshoring' by US multinationals is widespread among politicians. The underlying assumption is that multinational corporations substitute domestic economic activity for foreign. This column presents evidence that foreign and domestic investment go hand-in-hand at the firm level. This suggests that policies penalising firms for investing abroad will hurt, rather than help, the US economy.

Ursula Fritsch, Holger Görg, 23 September 2013

Outsourcing is a controversial practice. This column looks at its effects on firm-level innovation in emerging markets. The authors find robust evidence that outsourcing is positively related to various innovation measures. However, outsourcing only leads to increased R&D spending in countries where intellectual-property rights are well-protected.

Bernhard Dachs, Bernd Ebersberger, Steffen Kinkel, Oliver Som, 07 September 2013

European offshoring mostly concerns factory jobs, but some worry that innovation will soon follow. This column shows that offshoring firms employ more people in R&D and design, introduce more frequently new products, and invest more frequently in advanced process technologies compared to non-offshoring firms. Concerns that offshoring may hurt innovation because of the lost links between production and product development are not supported by the evidence.

Andreas Moxnes, Karen-Helene Ulltveit-Moe, Esther Ann Bøler, 18 July 2012

With trade barriers rising, the time is right to refresh the evidence that openness to trade comes with substantial benefits. This column focuses on the complementarity between R&D and foreign sourcing. Looking at Norwegian firms from 1997 to 2005, it argues that one fifth of productivity growth came from sourcing more foreign products, while the remaining four fifths came from technical change.

Ramon Marimon, 12 March 2012

The European Parliament is currently in talks over new ways to fund research. This column argues that unless the current proposal is changed, funding for research in social sciences will almost completely disappear from the main ‘cooperative research’ (now ‘Societal Challenges’) programme.

Eric Sun, Anupam Jena, Tomas Philipson , Darius Lakdawalla, Carolina Reyes, Dana Goldman, 11 January 2010

US healthcare costs are under scrutiny. Americans have spent billions of dollars on cancer research in recent decades. Has it paid off? This column says that investments in cancer research and development have been quite worthwhile – producing a value to society far in excess of costs.

David Popp, 26 November 2009

How will proposed increases in energy R&D funding affect other types of R&D spending? This column provides evidence that should dampen concerns about crowding out – increased R&D in response to policies designed to enhance clean-energy innovation most likely comes at the expense of R&D in dirty-energy technologies.

Bruno van Pottelsberghe de la Potterie, Nicolas van Zeebroeck, 11 October 2008

European innovators are increasingly turning to complex patent filing strategies. This column shows that such strategies pay off in patent value. But are applicants strategically abusing the filing process or turning to these methods because the current system does not meet their legitimate needs? Either symptom warrants reform.

Bruno van Pottelsberghe de la Potterie, Gaétan de Rassenfosse, 01 June 2008

Patent-based measures of innovation are often accused of reflecting the propensity to patent rather than actual research productivity. This column presents a better measure of patenting that reflects research productivity and identifies policies that affect research productivity and the propensity to patent.

Bruno van Pottelsberghe de la Potterie, 06 March 2008

Europe isn’t increasing its R&D intensity. Professor Pottelsberghe, former Chief Economist of the European Patents Office, identifies why Europe is missing its targets and looks to the R&D leaders – the US and Sweden – for policy lessons.

Paul Klemperer, 13 December 2007

No climate-change strategy will work unless it is consistent with developing countries' continued growth. So curbing emissions requires cheaper clean energy than is currently available. And that requires innovation.

Bruno van Pottelsberghe de la Potterie, 10 December 2007

Patent applications are booming, but many seem to be of low quality and/or strategically manipulated to hide the real invention within a myriad of claims. This delays the patent-granting process and hinders the system's ultimate goal of balancing incentives for knowledge creation with knowledge dissemination. Here are some ideas on how to fix the problem.

Bronwyn Hall, Grid Thoma, Salvatore Torrisi, 16 November 2007

Data on a thousand European firms show that an extra euro of R&D spending raises their 'Tobin's q' by 0.7 euros. R&D reporting, however, is not required in most European nations, so financial markets may be failing to properly value and thus reward innovative investments. One step towards the ‘knowledge economy’ would be to require Europe’s publicly-listed firms to disclose their R&D.

Rachel Griffith, John Van Reenen, Sokbae Lee, 07 September 2007

New empirical research on patent citations shows that when it comes to the flow of new ideas, distance is now dying. But for many sectors, especially in the more traditional and mature technologies, it is not yet dead; spatial agglomeration of R&D still makes sense.

Guido Tabellini, Alberto Alesina, 08 June 2007

GDP per capita is a poor measure since it leaves out home production and intangible investments. Considering these two items, however, suggests that if GDP were measured correctly, Europe’s relative decline might be even more pronounced.

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