- A-Z
- Jena Economic Resea...
- Volume 2
- Incumbent Innovatio...
Incumbent Innovation and Entry by Spinoff
- Autor(in)
- Erschienen
- 4. November 2008
- Nummer des Discussion-Papers
-
2008-083
- Schlagwort(e)
-
Entry
Innovation
Spinoff
- Zusammenfsg.
-
This paper takes a different perspective toward the escape entry incentive of incumbent firms to innovate. New entrants spawned from incumbents are not necessarily a threat; they can complement incumbents’ production by commercializing knowledge incumbents are not willing or able to exploit. Accordingly, incumbent innovation determines exploitable knowledge externalities for spinoffs while, at the same time, spinoffs are expected to influence incumbent innovation. To overcome this problem of endogeneity, we apply an IV approach to analyze a rich industry-level dataset (1987–2000) for Germany. We find evidence that entry by spinoffs does, indeed, have a positive impact on incumbent innovation.
- article pub. typess JER
- Research article
- article languages JER
- Englisch
- article research fields JER
- entrepreneurship
- JEL-Classification for JER
- O3 - Technological Change; Research and Development; L16 - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure; Industrial Price Indices ; M13 - New Firms; Startups