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The gains from technology: new products, exports and profits

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  • Dario Guarascio
  • Mario Pianta

Abstract

The introduction of new products, greater competitiveness-based export performances, and higher profits are three major benefits from technological change. We build on previous work that has identified ‘virtuous circles’ between R&D, innovation and profits in firms and industries [Bogliacino, F., and M. Pianta. 2013a. “Profits, R&D and Innovation: A Model and a Test.” Industrial and Corporate Change 22 (3): 649–678; Bogliacino, F., and M. Pianta. 2013b. “Innovation and Demand in Industry Dynamics. R&D, New products and Profits.” In Long Term Economic Development, edited by A. Pyka, and E. S. Andersen. Berlin: Springer., Bogliacino, F., M. Lucchese, L. Nascia, and M. Pianta. 2016a. “Modelling the Virtuous Circle of Innovation. A Test on Italian Firms” Industrial and Corporate Change. doi:10.1093/icc/dtw045.] and between R&D, innovation and exports [Guarascio, D., M. Pianta, M. Lucchese, and F. Bogliacino. 2015. “Business Cycles, Technology and Exports.” Economia Politica – Journal of Analytical and Institutional Economics 32 (2): 167–200; Guarascio, D., M. Pianta, and F. Bogliacino. 2016. “Export, R&D and New Products: A Model and a Test on European Industries.” Journal of Evolutionary Economics 26 (4): 869–905.]. We test a model – with a Three Stage Least Squares methodology – using data at the industry level – for 39 manufacturing and service industries – for 6 major EU economies – Germany, France, Italy, Spain, the Netherlands and the United Kingdom – over the period 1995–2011. Results confirm the presence of a ‘virtuous circle’ linking the gains from technology, and identify the specific role of additional variables and the presence of lags and feedbacks. Moreover, the relevance of differences between Northern and Southern European countries is examined, with separate estimations that shed new light on the heterogeneity of these relationships.

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  • Dario Guarascio & Mario Pianta, 2017. "The gains from technology: new products, exports and profits," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 26(8), pages 779-804, November.
    • Handle: RePEc:taf:ecinnt:v:26:y:2017:i:8:p:779-804
    DOI: 10.1080/10438599.2016.1257446
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    1. Robert C. Feenstra & Gene M. Grossman & Douglas A. Irwin (ed.), 1996. "The Political Economy of Trade Policy: Papers in Honor of Jagdish Bhagwati," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061864, December.
    2. Giovanni Dosi & Keith Pavitt & Luc Soete, 1990. "The Economics of Technical Change and International Trade," LEM Book Series, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy, number dosietal-1990, November.
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    Cited by:

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    2. Nascia, Leopoldo & Pianta, Mario, 2018. "Research and innovation policy in Italy," MPRA Paper 89510, University Library of Munich, Germany.
    3. Andrea Coveri & Mario Pianta, 2019. "The Structural Dynamics of Income Distribution:Technology, Wages and Profits," Working Papers 1901, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2019.
    4. Francesco Bloise & Irene Brunetti & Valeria Cirillo, 2022. "Firm strategies and distributional dynamics: labour share in Italian medium-large firms," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 39(2), pages 623-655, July.
    5. Costantini, Valeria & Crespi, Francesco & Paglialunga, Elena & Sforna, Giorgia, 2020. "System transition and structural change processes in the energy efficiency of residential sector: Evidence from EU countries," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 309-329.
    6. Cristiano Antonelli & Christophe Feder, 2021. "Knowledge appropriability and directed technological change: the Schumpeterian creative response in global markets," The Journal of Technology Transfer, Springer, vol. 46(3), pages 686-700, June.
    7. Chadi Azmeh, 2022. "Quantity and quality of research output and economic growth: empirical investigation for all research areas in the MENA countries," Scientometrics, Springer;Akadémiai Kiadó, vol. 127(11), pages 6147-6163, November.
    8. Cristiano Antonelli & Christophe Feder, 2021. "Schumpeterian loops in international trade: the evidence of the oecd countries," Journal of Evolutionary Economics, Springer, vol. 31(3), pages 799-820, July.
    9. Cristiano Antonelli & Christophe Feder, 2021. "The Schumpeterian creative response: export and innovation: evidence for OECD countries 1995–2015," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(3), pages 803-821, October.
    10. Liu, Duan & Wang, Qiuhong & Wang, Aidi & Yao, Shujie, 2023. "Export profitability and firm R&D: on China's export diversification under trade war," Structural Change and Economic Dynamics, Elsevier, vol. 67(C), pages 151-166.
    11. Francesco Lamperti & Franco Malerba & Roberto Mavilia & Giorgio Tripodi, 2019. "Does the Position in the Inter-sectoral Knowledge Space affect the International Competitiveness of Industries?," LEM Papers Series 2019/23, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    12. Francesco Crespi & Dario Guarascio, 2019. "The demand-pull effect of public procurement on innovation and industrial renewal," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 28(4), pages 793-815.
    13. Cirillo, Valeria & Evangelista, Rinaldo & Guarascio, Dario & Sostero, Matteo, 2021. "Digitalization, routineness and employment: An exploration on Italian task-based data," Research Policy, Elsevier, vol. 50(7).
    14. V. L. Tambovtsev, 2019. "Institutions-technologies interaction and economic growth," Journal of New Economy, Ural State University of Economics, vol. 20(2), pages 55-70, May.
    15. Andrey V. Misyura, 2019. "High-tech industrial company: A normative and a positive approach to the definition," Journal of New Economy, Ural State University of Economics, vol. 20(4), pages 88-107, September.
    16. Emanuele Brancati & Raffaele Brancati & Dario Guarascio & Andrea Maresca & Manuel Romagnoli & Antonello Zanfei, 2018. "Firm-level Drivers of Export Performance and External Competitiveness in Italy," European Economy - Discussion Papers 087, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.

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