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Leahy, Dermot (2007) Absorptive capacity, R&D spillovers, and public policy. International Journal of Industrial Organization, 25 (5). pp. 1089-1108. ISSN 0167-7187
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Abstract
Empirical evidence strongly suggests that R&D increases a firm's “absorptive capacity” (its ability to absorb
spillovers from other firms) as well as contributing directly to profitability. We explore the theoretical implications
of this. We specify a general model of the absorptive capacity process and show that costly absorption
both raises the effectiveness of ownR&Dand lowers the effective spillover coefficient. Thisweakens the case for
encouraging research joint ventures, even if there is complete information sharing between members. It also
implies an additional strategic pay-off to policies that raise the level of extra-industry knowledge.
| Item Type: | Article |
|---|---|
| Keywords: | Absorptive capacity of R&D; Competition policy; Industrial policy; R&D spillovers; Research joint ventures; |
| Academic Unit: | Faculty of Social Sciences > Economics, Finance and Accounting |
| Item ID: | 8461 |
| Depositing User: | Dermot Leahy |
| Date Deposited: | 18 Jul 2017 08:52 |
| Journal or Publication Title: | International Journal of Industrial Organization |
| Publisher: | Elsevier |
| Refereed: | Yes |
| Related URLs: | |
| Use Licence: | This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available here |
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