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PUBLICATIONS & REPORTS
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Innovation and Market Structure Dynamics in Taiwan’s Manufacturing
| Author | Chih-Hai Yang |
|---|---|
| Date of Publication | 2007. 10 |
| No. | 2007-22 |
| Download | 377KB |
Contents Introduction
This paper examines the relationship between innovation and market structure and dynamics in Taiwan’s manufacturing industries. In order to account for the causality between innovation and market structure and to deal with the problems caused by heterogeneity among industries, the generalized method of moment for (dynamic) panel data model is employed in this study. Meanwhile, I use the concept of technological regimes to examine the effect of innovation on market structure within high and low R&D intensity industries. The results show that innovation is positive related to market structure and the strength of the relationship is stronger in industries with relatively low R&D intensity. In samples containing all industries, R&D intensity seems to have no effect on market structure dynamics. However, in samples of industries with relatively high R&D intensity, R&D intensity is negatively correlated with concentration, whereas a positive correlation is observed in industries with relatively low R&D intensity. This result suggests that it is important to distinguish the nature of technological regimes when investigating the innovation–market structure dynamics nexus.