Keiko Ito, Kenta Ikeuchi, Chiara Criscuolo, Jonathan Timmis, Antonin Bergeaud, 23 April 2020

Interconnectedness and relative position in global production networks is an important factor for modern economies. In recent years, Japanese firms have lost their relative influence within the regional value chain. This column analyses the relationship between measures of network centrality and firm innovation output. It finds that having access to a greater breadth of customers is positively related to innovative activities, measured by patent applications. The results suggest an important role of knowledge spillovers from foreign markets.

William Connell, Emmanuel Dhyne, Hylke Vandenbussche, 30 January 2020

How do firms become exporters? Using transaction-level data from Belgium, this column examines the role of intermediary firms in the internationalisation process. It finds that a manufacturing firm that exports indirectly to a particular destination via a wholesaler is more likely to go on to become a direct exporter to that destination at a later point. This effect is driven by the spillover over of knowledge on foreign demand from the wholesaler to the manufacturer. The role of intermediaries is particularly important for destination markets that are further afield, where firms face greater uncertainty. 

Michel Serafinelli, 17 October 2017

The productivity benefits of similar firms locating near one another are well accepted, but there is little agreement on how knowledge spillovers have local effects. This column presents evidence from Italy of how firm-to-firm labour mobility enhances the productivity of firms located near other, highly productive firms. The main finding is that the recruitment of workers with experience at good firms significantly increases the productivity of the firms hiring them.

Hiroyasu Inoue, Kentaro Nakajima, Yukiko Saito, 11 February 2015

Despite vast improvements in information and communications technology, the tendency of firms in related industries to cluster together hardly changed between 1985 and 2005. This column examines the relationship between geographic clustering and innovation using establishment-level data from Japan. Research establishments – especially those in high-technology industries – are more localised than average. The degree of localisation is greater when establishments are weighted by their creativity, as measured by the number of patents created and the number of citations received.

Sharon Belenzon, 03 July 2012

According to the received wisdom, innovation is the heart-and-soul of modern growth but incentives to innovate are prone to the free-rider problem. This column partly supports that view. Looking at over 1,000 US companies it shows that internal citations of a firm's patents have a positive effect on market value while external citations have a negative effect.

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.

CEPR Policy Research