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We examine how research and development (R&D) incoming spillovers affect long-run firm performance following firms' R&D increases. We use a stochastic frontier production method to capture R&D incoming spillover effects. Firms reaping more benefits from R&D investment made by other firms experience more improvement in profitability and more favorable long-run stock performance in the post-R&D-increase period. Firms with higher levels of R&D incoming spillovers recruit more key employees from other firms, suggesting that obtaining know-how through hiring is an important source of incoming spillovers. The evidence also shows that firms experiencing more R&D outgoing spillover effects tend to underinvest in R&D. [ABSTRACT FROM AUTHOR]

We predict that a firm's greater accounting comparability with its industry peers facilitates its learning from those peer firms' research and development (R&D) investments, allowing that firm to have greater innovative efficiency. We estimate accounting comparability using pro forma capitalized R&D earnings that link lagged R&D expenditures to future profitability employing the Almon (1965) distributed lag model. We find that greater accounting comparability leads to enhanced ability to predict future cash flows generated by R&D investments of peer firms. In the cross-section, we observe that the relation between accounting comparability and innovative efficiency is stronger if peer firms exhibit higher accounting (accrual) quality and are themselves successful innovators. In sum, this study shows that a shared qualitative characteristic of accounting, namely, accounting comparability, is positively associated with innovative efficiency. JEL Classifications: G12; G14; O32. [ABSTRACT FROM AUTHOR]

Nanomedicine is one of the emerging technologies and a branch of nanotechnology finding applications in healthcare. Many countries, including India, are pursuing active research programs in nanomedicine to explore novel healthcare solutions to address specific healthcare needs of the society. At present, the government of India, through its various agencies, is funding nanomedicine research in India. It is anticipated that in the next 5 years or so, several nanomedicine-based products shall reach the market. Thereby, it becomes pertinent to evaluate the extent of India’s involvement in activities related to innovation in nanomedicine. However, a comprehensive landscape of nanomedicine innovation in India is currently lacking. This paper attempts to profile the status of research and innovation in the field of nanomedicine in India. The current study evaluates the innovation on the basis of five indicators: financial ecosystem, technology source, research translation, bibliographic data (patents and publications), and regulation. Public-private partnerships and international collaborations are also discussed in the paper. The landscape elucidates current status of nanomedicine in India and may be relevant for policy-related matters. [ABSTRACT FROM AUTHOR]

Prior studies find that firms cut research and development (R&D) expense in response to earnings considerations. We extend this stream of research by documenting that firms narrowly achieving an earnings threshold also report unusually high capital expenditures. In addition, these firms’ total investments (R&D expense plus capital expenditures) do not vary in response to earnings thresholds, which suggests that, on average, reductions in R&D expense are offset by concurrent increases in capital expenditures. Lastly, our research design allows us to infer that the increased capital expenditures are largely R&D investments that are capitalized instead of non-R&D capital expenditures, suggesting that overall investments in R&D are relatively unchanged. [ABSTRACT FROM AUTHOR]

In this paper, we study to what extent inconsistent feedback signals about performance affect firm adaptive behavior in terms of changes made to research-and-development (R&D) investments. We argue that inconsistency in performance feedback—based on discrepancies between two distinct performance signals—affects the degree to which such investments will be changed. Our aim is to show that accounting for inconsistent performance feedback is necessary as predictions for the direction of change in R&D investments based on the individual performance feedback signals are contradictory. Furthermore, we contribute by proposing a holistic consideration mechanism as an alternative to the selective attention mechanism previously applied to inconsistent performance feedback. Our findings show that the impact of inconsistency depends on the exact configuration of the underlying performance feedback signal discrepancies. While consistently negative performance feedback signals would amplify their impact in stimulating increased R&D investments, inconsistent performance feedback signals created more nuanced effects. Having lower performance compared to an industry-based peer group—despite doing well compared to the previous year—made firms decrease their R&D investments. For the opposite case of inconsistent performance feedback, we did not find an effect on change in R&D investments. These findings support to a degree our contention that explaining the effects of inconsistent performance feedback requires a holistic consideration theoretical mechanism instead of one involving selective attention. In sum, these findings suggest future research should take into account the differences between distinct instances of inconsistent performance feedback. [ABSTRACT FROM AUTHOR]

We examine whether subsidies are allocated to financially constrained firms and if they effectively alleviate these constraints. We claim that in addition to the usual "public good" arguments behind the allocation of subsidies, the extent to which firms are able to obtain external funding should not be overlooked. Overall, our results question both the allocation and the effectiveness of subsidies in alleviating financial constraints of firms willing to innovate. Additionally, the decision criteria for allocating public funds seem to be similar from those used by the private investors. These results have important implications on the design of future innovation policy. [ABSTRACT FROM AUTHOR]

Europe and the USA are the two popular overseas R&D investment destinations for Chinese companies. We explore whether there are significant differences or similarities in the comparison of international R&D strategies of Chinese MNCs in Europe and the USA. Specifically, we examine how Chinese MNCs implement R&D strategies to facilitate learning. We adopt the method of theory building from case study research to answer this question. Based on 14 R&D units of 12 Chinese companies in Europe and the USA, our analysis investigates and compares the R&D strategies of Chinese multinationals in Europe and the USA, focusing on their strategic motives, R&D structure, and modes of learning. Our findings have strong managerial and policy implications. [ABSTRACT FROM AUTHOR]

The stocks in a momentum portfolio, which contribute to momentum profits, do not experience significant subsequent reversals. Conversely, stocks that do not contribute to momentum profits over the intermediate horizon exhibit subsequent reversals. Merging these separate securities into a single portfolio causes momentum and reversal patterns to appear linked. Stocks with momentum can be separated from those that exhibit reversal by sorting on size and book-to-market equity ratio. Controlling for proxies for behavioral biases, market illiquidity, and macroeconomic factors does not affect our results. [ABSTRACT FROM AUTHOR]

Across the world, large firms show a greater propensity to undertake innovative activity. Large firms are more active in R&D activities, technology in-licensing, employing qualified manpower, organizational and marketing practices. In India too, bulk of industrial R&D investment comes from large firms. Analyzing a panel dataset of 610 large manufacturing firms having higher propensity to undertake R&D activities over a span of 6 years (2009-2014), the paper tries to identify the determinants of R&D investment in large manufacturing firms in India. The result shows that the large manufacturing firms who are younger in age, highly engaged in import and export activities and more profitable have higher propensity to undertake R&D activities and investment. The result could provide policymakers a handle to create a space for targeted initiatives for the large manufacturing firms in India. [ABSTRACT FROM AUTHOR]

The article discusses the results of the 2017 R&D Trends Forecast annual survey of the Industrial Research Institute (IRI) in Virginia. Topics include the estimated increase in global research and development (R&D) investments based on purchasing power parity (PPP) values, a strong and growing support for existing business projects, and sentiments regarding R&D expenditures from sectors such as aerospace, academia, and the government/nonprofit segment.

We analyse how the financing of R&D investment in corporate entities in Malaysia has been affected by the implementation of Basel II. We show the results by disaggregating into three sub sectors: (1) firms with large investments in capital, (2) those not as intensive, (3) and all firms for which we have data on default rates. Our results show that both before and after Basel II, firms do not borrow from external resources in order to build R&D expenditure strategies, and we argue that firms obtain financial resources from external sources for assets purposes rather than for investment and sales strategies. Therefore Basel II was not able to change firm's financing patterns in relation to R&D, and this fact should be important for policy makers when planning future Basel accords. We also show that firms operating in industries which are characterized by a lower incidence of intangible assets are less exposed to financial constraints. Finally, for those firms for which we have data on default rates in 2008, we show that intangible assets in these companies are more exposed to financial constraints. [ABSTRACT FROM AUTHOR]

We investigate the relationship between R&D investments and loan spread. Prior research documents that R&D is associated with greater future benefits and risks, suggesting that the valuation of R&D depends on a tradeoff between the two. Some research finds that bondholders consider that the benefits of R&D outweigh its risks: R&D is negatively associated with bond yields. This is surprising given that debt holders are more concerned about downside risk due to asymmetric payoffs. Using data on private debt from the US, we find an overall positive association between loan spread and R&D intensity, suggesting that the riskiness of R&D appears to outweigh its benefits for private lenders. Furthermore, an asymmetric payoff structure implies that the risks of R&D for lenders increase with default risk. Consistent with this argument, we find a positive association between R&D and loan spread for firms that are smaller, with high default-risk ratings, unrated (no public debt), or in industries with weaker legal protection. Unrated firms are in the most R&D-intensive group and make up nearly 60% of the firms with private debt. Consequently, studies that exclude unrated firms are likely to present an incomplete picture of the perspective of debt holders on R&D. [ABSTRACT FROM AUTHOR]

In this study, we examine how board characteristics, such as the independent director ratio, board size, and the number of interlocks, influence the investment of slack resources into research and development (R&D) by a firm. Both the agency theory and resource dependence theory predict a positive influence of independent director ratio on the financial slack-R&D investment relationship. However in the case of board size and number of interlocks, resource dependence theory argues for a positive moderating effect, while agency theory predicts a negative effect. The hypotheses are tested on the seven-year panel data of 172 firms in the Indian pharmaceutical industry, an emerging economy, high technology industry. We find broad support for the resource provisioning role of the board of directors, which is attributed to the emerging economy context of the Indian pharmaceutical industry, where firms face high levels of opportunity but lack resources to make use of them effectively. [ABSTRACT FROM PUBLISHER]

Information and communication technologies (ICT) play an important role by contributing to rapid technological progress and productivity growth. The ICT sector represents 4.8% of the European economy. It generates 25% of total business expenditure in Research and Development (R&D), and investments in ICT account for 50% of all European productivity growth. It is therefore obvious that ICT lies at the heart of research and innovation globally. The European Union considers that ICT have a catalytic impact in three key areas: productivity and innovation, by facilitating creativity and management; modernisation of public services, such as health, education and transport; and advances in science and technology, by supporting cooperation and access to information. Horizon 2020 is the European Union framework programme for research and innovation for 2014-2020. EU investments in ICT increased by about 25% under Horizon 2020 compared to the previous EU framework programme for research, FP7. This EU investment supports the whole chain from basic research to innovation that can deliver new business breakthroughs, often on the basis of emerging technologies. In Horizon 2020, ICT-related topics can be found in all priorities and programmes. The overall structure of the Work Programme for Information and Communication Technologies 2016-2017 is very similar to the one of 2014-2015, however, a few changes were made, namely: Activities aiming at supporting innovative SMEs of the ICT sector through the dedicated SME instrument are grouped together with similar activities addressing other scientific and technical fields in a single call of the 'Innovation in SMEs' part of Horizon 2020; 'Cross-cutting activities' combining contributions from the 'Leadership in enabling and industrial technologies' priority and 'Societal Challenges' are also grouped together in a specific part of Horizon 2020. [ABSTRACT FROM AUTHOR]

Companies invest in R&D to create and exploit new opportunities. In recent years, leading innovative companies have attempted to establish a market for technologies and create leveraging opportunities through such markets. In this paper, we consider the question of how a firm can evaluate its patent portfolio for licensing purposes. To this end, we propose an approach that enables large corporations to scrutinize their portfolio of (patented) technologies and to subsequently set up royalty rate values to support the negotiation process of a particular technology. We use case-based research to develop our approach, which we illustrate with an in-depth assessment of 50 technologies. We conclude by discussing the pros and cons of our approach and its potential generalization to other companies and considering how it can be used to indicate value drivers for R&D strategy. [ABSTRACT FROM AUTHOR]

We investigate how corporate governance influences R&D across 13 emerging markets. We find that superior corporate governance increases corporate R&D spending. These results suggest that corporate governance may influence management's discretion to avoid risky innovative projects. We also find that the link between firm-level governance and corporate R&D is stronger in countries with weaker country-level governance. These results suggest substitutability between firm and country governance in generating innovation activities. [ABSTRACT FROM AUTHOR]

ABSTRACT In this study, we have tried to analyze the influence of research and development (R&D) investment on real option value (ROV), expended net present value (ENPV) and market value by analyzing R&D investment, ROV, ENPV and market value of different industry types from an ex post perspective. The results show that ENPV, which has been deduced by real option according to R&D investment, reflects market value well and possesses a strong correlation with R&D investment, ROV, ENPV and market value. This implies that our study result corresponds with existing theories. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In this paper, we provide an explanation for why upstream firms merge, highlighting the role of R&D investments and their nature, as well as the role of downstream competition. We show that an upstream merger generates two distinct efficiency gains when downstream competition is not too strong and R&D investments are sufficiently generic: The merger increases R&D investments and decreases wholesale prices. We also show that upstream firms merge unless R&D investments are too specific and downstream competition is neither too weak nor too strong. When the merger materializes, the merger-generated efficiencies pass on to consumers, and thus, consumers can be better off. [ABSTRACT FROM AUTHOR]

The characteristics of R&D activities (high-risk, cross-period income and serious information asymmetry) induce particularly serious agency problem. Appropriate corporate governance mechanisms can reduce information asymmetry and control manager's opportunistic behavior, which would influence corporate R&D decision-making. Therefore, scholars have attempted to disprove Schumpeterian hypothesis linking industrial concentration and R&D activities and explored the influence of corporate governance on R&D input. This paper provided an overview of the major literature which has developed in the area of the relationship between ownership structures, board of directors, incentive system and R&D investment. We conclude that current research has generated a number of useful insights. However, there are many fundamental questions that remain unanswered. In the future, we should pay more attention to intermediate mechanism of corporate governance and R&D investment, study the relationship between each variable of corporate governance and R&D investment in a unified analytical framework and explore the coordination mechanisms and causal relationship of governance innovation and technology innovation. [ABSTRACT FROM AUTHOR]

Objective: To propose a measure (index) of expected risks to evaluate and follow up the performance analysis of research projects involving financial and adequate structure parameters for its development. Methods: A ranking of acceptable results regarding research projects with complex variables was used as an index to gauge a project performance. In order to implement this method the ulcer index as the basic model to accommodate the following variables was applied: costs, high impact publication, fund raising, and patent registry. The proposed structured analysis, named here as RoSI (Return on Scientific Investment) comprises a pipeline of analysis to characterize the risk based on a modeling tool that comprises multiple variables interacting in semi-quantitatively environments. Results: This method was tested with data from three different projects in our Institution (projects A, B and C). Different curves reflected the ulcer indexes identifying the project that may have a minor risk (project C) related to development and expected results according to initial or full investment. Conclusion: The results showed that this model contributes significantly to the analysis of risk and planning as well as to the definition of necessary investments that consider contingency actions with benefits to the different stakeholders: the investor or donor, the project manager and the researchers. [ABSTRACT FROM AUTHOR]

This paper discusses the controversial management decisions made by policy-makers worldwide regarding poisoning campaigns aimed to control small mammal populations, often considered harmful economic pests. Aside from considerations regarding the biological consequences of these campaigns, we argue that when society rejects all values of science and expertise then only badly supported and negligent decisions will be made about conservation and management issues. The extermination of small mammal species, some of which play crucial ecological roles in several regions of the world, is just an example of such discredit and misinformation. Without a strong commitment towards evidence-based policy-making, economic investments in research and development could be entirely compromised.. [ABSTRACT FROM AUTHOR]

This paper uses a comprehensive firm level data set for the manufacturing sector in Italy to investigate the effect of government support on privately financed R&D expenditure. Estimates from a non-parametric matching procedure suggest that public assistance has a positive effect on private R&D investment in the sense that the recipient firms achieve more private R&D than they would have without public support. This indicates that the possibility of perfect crowding out between private and public funds can be rejected. Furthermore, in this sample of Italian firms, tax incentives appear to be more effective than direct grants. The paper also examines whether public funding affects the financial sources available for R&D and finds that grants encourage the use of internal sources. The results also show some evidence of positive effects on credit financing for R&D. [ABSTRACT FROM AUTHOR]

* This paper investigated the influence of country-level factors that have led to shifts in the patterns of international R&D investments made by Multinational Corporations (MNCs), from an exclusive focus on developed countries to a broader scope that also includes developing countries. * Differences in a country's national technological innovation capability, that comprised the country's capacity for the creation of technology, technology infrastructure and the development of human skills, were the most important factors in attracting R&D investments. * Different strategic motivations like home-base exploiting versus home-base augmenting foreign R&D investments are attracted to countries with differing national innovation capabilities. The country's Intellectual Property Rights (IPR) score was also an important influence on R&D investments. International investor's experience with the country, as measured by prior FDI inflows, was a critical element in attracting R&D investment inflows. [ABSTRACT FROM AUTHOR]

The article discusses the significant investment needed in producing a breakthrough drug. Key findings in the analysis of the actual success rates achieved in drug research and development (R&D) for hepatitis C virus (HCV) showed that the breakthroughs have come at a high cost with a 2.0% overall success rate. Results in the investigation of drugs for Alzheimer disease (AD) and antibiotic-resistant infections, highlighting the substantial level of R&D investment required are also offered.

The author discusses the biotechnology and life sciences industry in Europe. Topics discussed include Great Britain emerging as the most preferred destination for innovative projects due to rise in research and development investments, sell-offs in biotechnology stocks, and concerns of potential investors over high drug prices.

The author discusses various elements of research and development (R&D). The author states the emergence of new research areas and the increasing amount of funding given to R&D. He comments on the reduction of drying R&D effort in countries that rely on high-technology industries as well as emerging economies' increased effort. He adds that through open innovation, the team of industrial R&D can benefit from technologies and ideas formulated outside the group or company.