Detail práce

Competition and Innovation: Revisiting the Relationship Using Alternative Measures of Rivalry

Autor: Mgr. Anton Astakhov, BA
Rok: 2015 - letní
Vedoucí: Jiří Novák M.Sc., Ph.D., Deloitte Corporate Chair
Typ práce: Diplomová
Jazyk: Anglicky
Stránky: 104
Abstrakt: This study re-examines the relationship between competition and innovation in a detailed firm-level
dataset of publicly traded US companies spanning from 1975 to 2013. Using R&D expenditures, patent
counts and patent citations as the measures of innovation, and Herfindahl-Hirschman Index, Lerner
Index, Profit Elasticity and Product Market Fluidity as the proxies for competition we document a robust
positive association between the two variables, as well as strong evidence of the non-linear relationship
known as "inverted-U shape", when controlling for size, distance to technological frontier, level of
knowledge spillovers, technological opportunities and other firm- and industry-specific characteristics.
We address overdispersion in the data by using negative binomial and zero-inflated negative binomial
count data regressions, and the results are robust in these specifications. Additionally, in order to address
potential endogeneity issues, we employ a set of instruments based on the import tariff rates and the
level of Chinese import penetration, and find a weak evidence of positive relationship as well. Overall
the results strongly support the prediction of agency models, "replacement effect" and "escapecompetition
effect" about the positive influence of competition on innovation.


McKinsey & Company