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The link between R&D investment and market structure: evidence from Japan

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  • Keiichi Shima

    (Hirosaki University)

Abstract

This paper examines how market structure affects R&D investment at the firm level. Using a sample of 1338 Japanese firms, a sample selection model is employed to estimate R&D investment. The pooled sample results suggest that the likelihood of conducting R&D is negatively associated with market concentration. However, the relationship becomes insignificant when the model is estimated by industry group. Large market sales have a positive effect on the likelihood of conducting R&D for both pooled and industry group samples.

Suggested Citation

  • Keiichi Shima, 2011. "The link between R&D investment and market structure: evidence from Japan," Economics Bulletin, AccessEcon, vol. 31(2), pages 1706-1716.
    • Handle: RePEc:ebl:ecbull:eb-11-00181
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    References listed on IDEAS

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    1. Czarnitzki, Dirk & Kraft, Kornelius, 2004. "An empirical test of the asymmetric models on innovative activity: who invests more into R&D, the incumbent or the challenger?," Journal of Economic Behavior & Organization, Elsevier, vol. 54(2), pages 153-173, June.
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    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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