Can the External Environment Generate Better Economic Performance in Academic Spin-Offs?

Abstract

The strategic stimulus to economic development is innovation. It was defined by Schumpeter as the commercial or industrial application of something new (product, process, production method). New product developments grew out of process innovation, particularly the development of components made from new materials, and the techniques to produce them the value of process innovation is proportional to the level of output produced by a given firm. Based on this we can distinguish two different life cycles: the life cycle of product technology and life cycle process technology. It’s appropriate to understand if and how long these innovation processes lead to positive economic results. The innovation capabilities are the driver of long-term success. The relation should remain significant beyond short-term earnings or become even greater for earnings of a longer-term. The length of a firm’s innovation cycle appears to be a determinant of the relationship between enhanced innovation capabilities and future earnings. The paper proposes a framework to evaluate the impact of academic spin-offs at the local level. Spin-off creation is the most complex way of commercializing academic research but has the highest potential impact on the local context. We develop a framework that takes into account the direct and indirect impacts of spin-offs. In the empirical part of the paper, we apply this framework to a sample of Italian spin-offs between 2001 and 2017. The empirical analysis shows that measured in quantitative terms, the impact of spin-offs on the local economy is quite small. Using the selected variables, It's possible to affirm that the presence of business incubators represents an element capable of positively influencing the performance of academic spin-offs.