Knowledge that Transforms

Perceptions of countries’ policy environments and innovation efforts drive important investment and regulatory decisions, but those perceptions may be biased. One particular concern is that evaluations of richer countries might be inflated compared to evaluations of poorer countries, as general stereotypes of national success spill over into assessments of research capability. Comparison of World Economic Forum survey assessments of businesses’ research spending with official spending figures reveals that, among countries spending comparable amounts on research, richer countries receive higher survey ratings. Richer countries’ educational outcomes are similarly rated higher than similarly performing poorer countries’. These findings suggest that perceptions may systematically disadvantage economically poorer countries, thereby misdirecting real-world investments and policy decisions derived from those rankings.

This paper explores how technological capabilities influence the relationship between imported inputs and the export performance of firms. We apply threshold regression techniques to a representative dataset of Brazilian firms and find a strong positive influence of innovation skills on the relationship between imported intermediates and export revenues. We further find that the complementarities between importing and exporting are stronger for firms that export products with a higher scope for quality differentiation. We also observe that technological capabilities are directly correlated with export performance, confirming the view that innovation positively influences firms' international competitiveness. This relationship is not found to be significant for firms that export products with a low scope for quality differentiation and that export to lower income non-OECD markets. Overall, our results suggest that technological capabilities and the quality of imported inputs not only benefit firms directly but also complement each other in enhancing export competitiveness.

In recent years, nonprofit firms focused on specific diseases have increased their grantmaking efforts in the search of a cure. They have become more aggressive in directly funding research and lobbying for public support, even if their cause affects a small number of people. This paper contributes to the literatures on R&D financing by developing the first production function for disease and medical research nonprofits, a growing funder of biomedical R&D. Using IRS data, the model estimates the role of market competition and firm demographics on the adoption of grantmaking and lobbying strategies. Most notably, results provide evidence that firms in more geographically concentrated (less competitive markets) are more likely to adopt a lobbying strategy and less likely to be grantmaking on the extensive margin. Descriptive cases also illustrate funding discrepancies between charitable and government support across disease prevalence.

Whereas previous studies have not paid much attention to spatial units in buildings, and have merely measured diversity at the regional level, this study aims to calculate the industrial diversity in building units in the Seoul Metropolitan Area and examine the factors associated with such diversity using the multi-level model method. The results show that a vertical factory is an important industrial zone correlated strongly to diversity in building spaces. Industrial composition also positively associated with diversity. Industrial diversity tends to increase in technology-intensive industries, but decreases in traditional ones. Furthermore, this study reveals a pattern in which buildings with high diversity are spatially clustered in certain areas. Meanwhile, industrial parks have a negative association with diversity. High land prices also hinder the agglomeration of industries that aim for urban location, and may ultimately have a negative association with diversity.