ABSTRACT Do new manufacturing technologies of the Industry 4.0 (I4.0) boost TFP growth? By adopting a distance-to-frontier framework, this paper explores whether the adoption of (advanced) digital technologies affect the sectoral TFP growth rates across manufacturing industries of 14 European countries, during the period 2009–2019. We rely on a novel measure of adoption of I4.0 technologies (namely, advanced industrial robots, additive manufacturing and industrial internet of things), exploiting highly detailed (8-digit level) information on imports of capital goods embodying such technologies. Our results suggest that adopting new digital manufacturing technologies of the I4.0 brings quantitatively important and statistically significant contributions to sectoral TFP growth rates, although these are mostly concentrated in countries close to the technology frontier. In turn, these technologies seem to have hampered the process of convergence between European technological leaders and laggards over the last decade.

ABSTRACT The process of economic development in China cannot be separated from the ‘shadow’ of government target intervention. Under the Chinese system of fiscal decentralization, constraints created by local government fiscal revenue targets (CCFRTs) will have a series of influence on development economically and socially. Based on the fiscal revenue target data revealed in the government work reports of 281 prefecture-level cities in China from 2006 to 2019, this paper explores the influence of CCFRTs on green technology innovation (GTI). The findings are as follows: first, CCFRTs significantly inhibits GTI. Second, Spatial Durbin model analysis shows that CCFRTs has significant negative spatial spillover effect on GTI. Third, CCFRTs can affect GTI through the optimization of industrial structure, the level of human capital, and the degree of opening-up, technological progress and economic growth. Fourth, CCFRTs has an obvious threshold effect on GTI. Finally, the influence of CCFRTs on GTI has regional heterogeneity in central, eastern and western China. In the western and central regions, CCFRTs significantly restrains GTI significantly, while in the eastern region, CCFRTs significantly promotes GTI.

ABSTRACT Start-ups are essential contributors to economic development, but they often face several barriers to growth, including access to finance. We study their capital structure in their early years of operation through the lens of Pecking Order Theory, exploring how the pursuit of innovation influences firms’ reliance on different types of finance. Panel analyses of 8273 German start-ups show that innovation activities are relevant predict start-ups’ revealed preferences for finance. Effects on the type and order of financing sources depend on the degree of information asymmetries specific to research and development activities, human capital endowments, and the market introduction of new products and processes. New firms focused on research and development activities and with better human capital are less likely to receive informationally complex finance such as debt and will rely relatively more on owner and equity finance. Mixed evidence is found, instead, on the role of new products or processes. Our results suggest that the traditional pecking order theory does not hold for new firms, implying that owner and external equity play a much more prominent role for such firms. Then, managers and entrepreneurs should consider specific sources of finance and financial instruments in light of their innovative activities.

ABSTRACT This paper examines the impact of technological change on Indian economic growth using the Bayesian Vector Auto-Regressive (BVAR) methodology. We use a comprehensive annual time series dataset covering the period of 1980 to 2019 on real economic activity, gross fixed capital formation, and employment. Technological innovation is measured by the number of patents filed by resident Indians. Technological innovation positively impacts both economic growth and gross fixed capital formation. Our findings indicate that increasing the number of patents leads to higher investment, which drives India's economic growth. However, our results also point towards the possible negative influence of technological innovation on the aggregate employment scenario in India. Our main findings are robust to alternative identification strategies and variable transformation. The asymmetric analysis also corroborates the positive influence of patents on driving investment and economic growth in India.

ABSTRACT Based on the data of China A-share listed enterprises, this paper examines the actual effect and mechanism of the development of digital finance on different innovation behaviors of enterprises, by using the panel data model and regression-based mediation analysis. It is found that the development of digital finance not only promotes the R&D investment of enterprises but also improves the quantity and quality of enterprise innovation output. The incentive effect of digital finance on enterprise R&D investment is stronger than that on innovation output, while the incentive effect of digital finance on enterprise breakthrough innovation is stronger than that of incremental innovation. Both the ‘broadening’ and the ‘deepening’ of digital finance have a significant positive effect on enterprise innovation, while the ‘digitalization degree’ of digital finance has no significant effect on enterprise innovation, and even may hinder the improvement of innovation quality. The incentive effect of digital finance on the innovation output of state-owned enterprises is reflected in ‘quantity’, while the incentive effect on innovation of non-state-owned enterprises is reflected in ‘quality’. Digital finance can stimulate enterprise innovation by easing the financing constraints of enterprises, optimizing the government subsidy system, and improving the business environment.

ABSTRACT This paper explores the effects of innovation on firm survival by using data from a representative survey of small and medium manufacturing firms in the province of Salerno, Italy. We innovate upon the literature by (a) comparing the impact of different sources of internal and external knowledge (including universities) on the probability of firm survival; (b) assessing the mediating impact of the human capital of workers and entrepreneurs on learning from these knowledge sources. Finally, we measure the impact of different types of innovation on firm survival. Our evidence upholds the link between innovation and firm survival, particularly for product and organisational innovation. Results regarding the impact of different sources of knowledge highlight the roles of employee training, the human capital of entrepreneurs and workers and the productivity of university departments providing relevant knowledge. Other elements of external knowledge, such as proximity to the University of Salerno or being in the city of Salerno, are significant facilitators of survival only if mediated through high levels of the human capital of entrepreneurs and workers.

ABSTRACT This paper examines the conceptualization of innovation as a public good using an empirical analysis of patent transfers. It proposes that patents make inventions both excludable and alienable, in contrast to secrecy which only makes them excludable. A survival analysis finds that 10% higher complexity of patent descriptions is associated with 9% higher patent transfer hazard. This suggests that inventors more often patent complex inventions for the alienability motive – as opposed to the excludability motive. Small inventors transfer their patents less likely, but they do so sooner than other inventors. This suggests that patents enable an exchange of inventions that would otherwise be kept secret, but small inventors may not benefit from this function disproportionately more than others. These findings have implications for the conceptualization of innovation.

ABSTRACT The functions of the stock market such as investment exit mechanism (IPO), interest incentive and capital allocation are beneficial for corporate to engage in innovation activities with higher risk and longer cycle, but IPO underpricing will hinder the realization of such functions. This paper uses the fixed effect model for empirical analysis and finds that the long-term innovation performance of corporate s with IPO underpricing is poor. Mechanism analysis shows that IPO underpricing corporates will have management myopia, lack of R&D enthusiasm that inhibit corporate innovation. Further analysis shows that the improvement of corporate information transparency and institutional investor field research can alleviate this negative impact can alleviate this negative impact. The conclusion of this paper aims to improve efficiency of the capital market, promote the effective pricing of the capital market, and provide certain reference significance for the relevant policies of the capital market to support the high-quality development of the real economy.

ABSTRACT We propose that opposite changes in the hazards of patent commercialization (HPC) and technology substitution (HTS) lead to a U-shaped relationship between patent age and patent value. Using a dataset of 2446 patents assigned to firms in Chinese universities from 2015-2020, our empirical results support this U-shaped relationship. Young patents with more claims are regarded as more valuable, owing to a lower HPC, and old patents with more International Patent Classification (IPC) classes are regarded as more valuable, owing to a lower HTS. Moreover, backward references had a moderate effect on the U-shaped relationship, and an increase in backward references caused the turning point to move to the right, flattening the U-shaped relationship. Interestingly, the turning point of the U-shaped relationship is around the age of 5.2 years, and the hazard of university patent invalidation in China is highest at this age.

ABSTRACT Innovation is important to firms’ productivity, competitiveness, agility, resilience and growth. The success of a firm’s innovation strategy depends in part on how it combines and absorbs different innovation activities. Using the Crépon-Duguet-Mairesse (CDM) structural model, this paper analyses complementarity between product and process innovation for the case of small and micro manufacturing firms in Johannesburg, South Africa. The empirical analysis utilises rich new firm-level survey data that, unlike most firm surveys, includes micro-sized firms as well as informal enterprises. Our results show strong evidence of complementarity between product and process innovations in their effects on firm performance. The results suggest that firm size, capital intensity, firm age, innovation expenditure and financial constraints are key variables associated with complementarity. We extend the specifications used in previous studies to take account of the contextual setting, with split samples by firm formality, ownership and size. We find evidence of complementarity in formal firms only. Our results also show stronger effects of complementarity in micro-firms and foreign-owned firms. The findings have relevance for promoting innovation and for enhancing the effects of innovation on firm performance among micro- and small enterprises (MSEs) in a developing country context.