Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/24461
Authors: 
Gottschalk, Sandra
Janz, Norbert
Year of Publication: 
2001
Series/Report no.: 
ZEW Discussion Papers 01-39
Abstract: 
This paper examines empirically the relationship between innovation and market structure within a simultaneous framework at the industry level of aggregation. We use a model in which R&D affects both, demand and cost conditions. An optimization process leads to optimal industry R&D expenditure and market structure in a symmetric equilibrium. The model is applied to a newly constructed panel for Germany. Generalized Method of Moments (GMM) estimation techniques for dynamic panel data systems are used to estimate the parameters of interest. We found a positive long?run effect of R&D on markets? sales concentration. In contrast, competition enforces innovation, i.e. sales concentration has a negative impact on R&D.
Subjects: 
innovation
R&D
market structure
panel data
dynamic models
applied econometrics
JEL: 
L60
C33
L11
O31
Document Type: 
Working Paper

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