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Design versus utility innovation: Is corruption sanding or greasing the wheels of innovation?

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  • Rajeev K. Goel
  • James W. Saunoris

Abstract

This paper studies whether corruption has a greasing or a sanding effect on the production of innovation. The main novelty lies in comparing the relative impacts on design versus utility innovation. On the one hand, corruption can undermine (sand) the expected returns from patents, whereas on the other hand, patent holders might be able to increase (grease) the scope and applicability of their patents. Using U.S. state‐level data and controlling for bidirectional causality, results show the sanding effect of corruption with regard to utility patents, with the negative effect on design patents occurring only with a time lag.

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  • Rajeev K. Goel & James W. Saunoris, 2020. "Design versus utility innovation: Is corruption sanding or greasing the wheels of innovation?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(5), pages 848-860, July.
    • Handle: RePEc:wly:mgtdec:v:41:y:2020:i:5:p:848-860
    DOI: 10.1002/mde.3142
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    References listed on IDEAS

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    Cited by:

    1. Samuel Kwesi Dunyo & Samuel Amponsah Odei, 2023. "Firm-Level Innovations in an Emerging Economy: Do Perceived Policy Instability and Legal Institutional Conditions Matter?," Sustainability, MDPI, vol. 15(2), pages 1-24, January.
    2. German Blanco & Rajeev K. Goel, 2023. "Do weak institutions undermine global innovation production efficiency?," The Journal of Technology Transfer, Springer, vol. 48(5), pages 1813-1838, October.
    3. Gaygysyz Ashyrov & Helery Tasane, 2024. "The roles of foreign and domestic ownership in the corruption–firm innovation nexus," Bulletin of Economic Research, Wiley Blackwell, vol. 76(1), pages 167-202, January.
    4. Malik, Ashish & Froese, Fabian Jintae, 2022. "Corruption as a perverse Innovation: The dark side of digitalization and corruption in international business," Journal of Business Research, Elsevier, vol. 145(C), pages 682-693.
    5. Dokas, Ioannis & Panagiotidis, Minas & Papadamou, Stephanos & Spyromitros, Eleftherios, 2023. "Does innovation affect the impact of corruption on economic growth? International evidence," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 1030-1054.
    6. Mohammad, Shoeb & Yang, Jie & Butt, Irfan, 2024. "Does corruption have a sanding or greasing impact on innovation? Reconciling the contrasting perspectives through a systematic literature review," Research Policy, Elsevier, vol. 53(7).

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