O32 - Management of Technological Innovation and R&DReturn

What type of R&D is essential for creating innovations? Is in-house R&D more efficient than purchasing external innovations? The question of various strategies for private firms to succeed in developing innovations is key for ongoing national and international programmes for raising innovativeness of economies. The goal of the paper is to investigate the outcomes of different types of R&D in the context of innovations and to analyse their significance in European countries empirically. In this paper, we aim to provide a quantitative analysis of the problem on the data collected from the Common Innovation Survey. We cover innovations in products, services, production methods, distribution systems and supporting activities. The results suggest that both in-house and external R&D matter for firms' innovativeness, but the effect is stronger for the former for most of the types of innovations considered.

Business R&D spending has been shown to exert both direct and indirect positive effects on value added. Nevertheless, the heterogeneity of the returns to R&D has seldom been examined. Using detailed sectoral data from Czechia over the period 1995-2015, this study finds that privately funded business R&D has both direct and spillover effects, but that the publicly funded part of business R&D only leads to spillovers. The results further suggest that both upstream and downstream spillovers matter, regardless of the source of funding, and that during the period studied, R&D returns were heavily affected by the economic crisis. Lastly, private R&D offers significant returns only after reaching a critical mass, while the effects of public R&D spending do not display such non-linearity. This heterogeneity in the returns to business R&D should be reflected in innovation policy design.

The behavioral theory of the firm assumes that firms react on performance feedback by increasing their search for alternative courses of action. However, the empirical literature is full of contradictory findings. This paper puts forward the idea that at least part of these contradictions can be explained if we can identify groups of firms behaving differently from firms in other groups and theoretical propositions. The paper uses exploratory analysis of US and German industrial firms and changes in R&D expense as their response to financial performance feedback. The cluster analysis of behavioural patterns of these firms results in identifying several behaviourally distinctive groups. The findings support the idea that contradictions in previous studies may partially stem from having a different mix of heterogeneously behaving firms. Also, they point to the proposition that for further understanding of responses to performance feedback, these groups of firms should be analysed separately.

The aim of the article is to present a model of sentiment analysis tool application for planning directions of city development. The study presents a model of using sentiment analysis to build city development strategies as well as realization of projects related to it. The presented model is a part of a larger work on developing the concept of the Regional Spatial Business Community (RSBC). The RSBC is created on the basis of electronic communities built by stakeholders involved in the development of a given city. On the basis of surveys, a six-stage city development procedure is proposed. Using the aforementioned procedure, we describe potential data sources, the goals of sentiment analysis application and expected effects. Analyses of the applicability of sentiment analysis are made on the basis of observation of available tools. The obtained model is applicable; however, its implementation requires certain conditions to be met.

In this article, corruption is treated as an expression of human entrepreneurship, which does not fully fit in the commonly accepted moral and legal standards. Despite being negatively perceived, it is persistently present in the public, economic and political life of every country as evidenced by a number of press releases on corruption.
Research literature analysis reveals the existence of two conflicting opinions with regard to the way in which corruption affects innovative activity of companies and economic growth. The more morally correct theory, which can be dubbed the sand-the-wheels theory, assumes that corruption negatively influences innovative activity and economic growth. Whereas, the grease-the-wheels theory, which is inconsistent with the principles of social responsibility of business, argues for the positive influence of corruption on innovative activity of companies and economic growth. This article is a voice in that discussion.

Arrangements to cooperate on innovation facilitate access to external sources of knowledge. By using panel data derived from the five waves of Community Innovation Survey in the Czech Republic, we examine whether firms engage in these arrangements persistently or rather revert to other behaviour. Econometric estimates of dynamic random effects and multivariate probit models provide strong support to the thesis of persistence, particularly of linkages with the university sector and suppliers. The results are robust to the initial conditions problem and serial correlation in idiosyncratic errors. Government programmes initiating cooperation on innovation therefore have the potential to induce durable changes in the innovative behaviour of firms.

Many economic analyses use employer-employee data to compare wage and productivity differentials across demographic groups. We apply this approach to assess the importance of 'organizational' workers, i.e., managing and marketing personnel. The estimates based on 2000-2006 Czech worker-level data augmented with company balance sheet information suggest that these workers are important for company performance and that they are fairly rewarded for their relative productivity in terms of their relative pay. Foreign-owned companies feature higher shares of such workers who are more productive in these firms (relative to other employees) compared to domestically owned companies.