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'Inequality' of innovation: skewed distributions and the returns to innovation in Dutch manufacturing

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  • Orietta Marsili
  • Ammon Salter

Abstract

It is a commonly held view that returns to innovation are highly skewed, that is, not all firms innovate, and the returns received from innovation for the firms that are successful innovators are highly concentrated in the hands of the few. Using data from two community innovation surveys for the Netherlands, this article investigates the properties of the distribution of the returns to innovation for different types of innovation. It finds that the returns to innovation are indeed highly skewed, but the distribution of the returns is shaped by the degree of novelty of the innovation - the more novel the innovation, the greater the concentration of the returns. The article also explores the distribution of the returns across different sectoral contexts, finding that low-technology sectors are characterised by higher performance diversity among innovators than high-technology sectors.

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  • Orietta Marsili & Ammon Salter, 2005. "'Inequality' of innovation: skewed distributions and the returns to innovation in Dutch manufacturing," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 14(1-2), pages 83-102.
    • Handle: RePEc:taf:ecinnt:v:14:y:2005:i:1-2:p:83-102
    DOI: 10.1080/1043859042000228642
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    Cited by:

    1. Giacomo Marzi & Lamberto Zollo & Andrea Boccardi & Cristiano Ciappei, 2018. "Additive Manufacturing in SMEs: Empirical Evidences from Italy," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 15(01), pages 1-22, February.
    2. Bianca Potì & Giovanni Cerulli, 2009. "Heterogeneity of innovation strategies and firm performance," Springer Books, in: Uwe Cantner & Jean-Luc Gaffard & Lionel Nesta (ed.), Schumpeterian Perspectives on Innovation, Competition and Growth, pages 277-300, Springer.
    3. Mincheol Choi & Chang-Yang Lee, 2020. "Power-law distributions of corporate innovative output: evidence from U.S. patent data," Scientometrics, Springer;Akadémiai Kiadó, vol. 122(1), pages 519-554, January.
    4. Andræs Barge-Gil, 2013. "Open Strategies and Innovation Performance," Industry and Innovation, Taylor & Francis Journals, vol. 20(7), pages 585-610, October.
    5. de Jong, Jeroen P.J. & Marsili, Orietta, 2006. "The fruit flies of innovations: A taxonomy of innovative small firms," Research Policy, Elsevier, vol. 35(2), pages 213-229, March.
    6. Bernhard Dachs & Bernd Ebersberger & Hans Lööf, 2008. "The innovative performance of foreign-owned enterprises in small open economies," The Journal of Technology Transfer, Springer, vol. 33(4), pages 393-406, August.
    7. Jos'e Alejandro Mendoza & Faustino Prieto & Jos'e Mar'ia Sarabia, 2021. "Inequality in the use frequency of patent technology codes," Papers 2111.11211, arXiv.org.
    8. Nabil Abou Lebdi,, 2015. "Radical Innovation – A domain of SMEs? A novel test of the Schumpeterian Hypothesis," DEM Discussion Paper Series 15-04, Department of Economics at the University of Luxembourg.
    9. Gómez, Jaime & Salazar, Idana & Vargas, Pilar, 2020. "The Role Of Extramural R&D And Scientific Knowledge In Creating High Novelty Innovations: An Examination Of Manufacturing And Service Firms In Spain," Research Policy, Elsevier, vol. 49(8).
    10. Ebersberger, Bernd & Marsili, Orietta & Reichstein, Toke & Salter, Ammon, 2008. "Fortune favours the brave: The distribution of innovative returns in Finland, the Netherlands and the UK," Structural Change and Economic Dynamics, Elsevier, vol. 19(4), pages 357-362, December.
    11. Lee, Jangwook & Chung, Jiyoon, 2022. "Women in top management teams and their impact on innovation," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    12. de Leeuw, Tim & Lokshin, Boris & Duysters, Geert, 2014. "Returns to alliance portfolio diversity: The relative effects of partner diversity on firm's innovative performance and productivity," Journal of Business Research, Elsevier, vol. 67(9), pages 1839-1849.
    13. Brian Paul Cozzarin & Weonseek Kim & Bonwoo Koo, 2017. "Does organizational innovation moderate technical innovation directly or indirectly?," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 26(4), pages 385-403, May.
    14. Rutzer, Christian, 2014. "A Theory of Trade Liberalization and Innovations with Heterogeneous Firms," Working papers 2014/02, Faculty of Business and Economics - University of Basel.
    15. Mata, José & Woerter, Martin, 2013. "Risky innovation: The impact of internal and external R&D strategies upon the distribution of returns," Research Policy, Elsevier, vol. 42(2), pages 495-501.
    16. Arianna Martinelli & Önder Nomaler, 2014. "Measuring knowledge persistence: a genetic approach to patent citation networks," Journal of Evolutionary Economics, Springer, vol. 24(3), pages 623-652, July.
    17. Baig, Ahmed & Butt, Hassan Anjum & Fitwi, Abrar & Smith, Joey, 2021. "Does Innovation Explain the Skewness of Stock Returns?," American Business Review, Pompea College of Business, University of New Haven, vol. 24(2), pages 12-31, November.
    18. Sandra M. Leitner & Robert Stehrer, 2011. "Shapes and determinants of returns to innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 20(8), pages 777-795, December.
    19. Segarra Blasco, Agustí & Teruel Carrizosa, Mercedes, 2008. "Innovation sources and productivity in Catalonian firms: a quantile regression analysis," Working Papers 2072/9259, Universitat Rovira i Virgili, Department of Economics.
    20. Idika Awa Uduma & Andy Fred Wali & Len Tiu Wright, 2015. "A quantitative study on the influence of breadth of open innovation on SMEs product-service performance: The moderating effect of type of innovation," Cogent Business & Management, Taylor & Francis Journals, vol. 2(1), pages 1120421-112, December.
    21. Falk Martin, 2015. "Employment Effects of Technological and Organizational Innovations: Evidence Based on Linked Firm-Level Data for Austria," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(3), pages 268-285, June.
    22. Mercedes Teruel & Agustí Segarra, 2011. "Productivity and R&D sources in manufacturing and service firms in Catalonia: a regional approach," ERSA conference papers ersa11p1860, European Regional Science Association.
    23. Pu Liu & Yingying Shao, 2022. "Innovation and new business formation: the role of innovative large firms," Small Business Economics, Springer, vol. 59(2), pages 691-720, August.

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