What might motivate applied R&D cooperation? Answer via two case studies
Rutsaert, Pauline (1994). What might motivate applied R&D cooperation? Answer via two case studies. UNU-MERIT Research Memoranda. UNU-MERIT.
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Sub-type Working paper Author Rutsaert, Pauline Title What might motivate applied R&D cooperation? Answer via two case studies Series Title UNU-MERIT Research Memoranda Volume/Issue No. 30 Publication Date 1994 Publisher UNU-MERIT Language eng Abstract A review of the existing literature concerning cooperation in research and development (R&D) seems to suggest that there are fewer motivations to cooperate in applied R&D than in fundamental R&D. Indeed, at the applied R&D stage, spillovers are lower, technological uncertainty is reduced, and the likely marketability of the outcome of applied R&D makes member firms fear fierce inter-member competition at the market stage. The study of two cooperative agreements in applied R&D, one in a sector of the European food industry and one in the pharmaceutical industry, reveals that market factors provide in some situations stronger motivations to engage in applied R&D cooperation than technological elements do. In the two cases under examination, an innovative firm identifies the joint venture (JV) as the most profitable growth strategy to market its innovation, given the constraints on capital control and the necessity to have access to complementary assets. The cooperation in applied R&D is then agreed by the members to consist of an initial unilateral transfer of know-how and the joint development of new applications. It is viewed to act as the cement of a broader JV primarily aimed at joint production and joint marketing. The motivation analysis of these specific agreements also highlights the possibility of an upstream causality link between R&D and market stages, i.e., production and sales collaboration inducing R&D cooperation. In addition, these case studies exemplify the theoretical result of Rutsaert (1994) that the incentive to cooperate in R&D when market competition is fierce after the cooperation can be restored by allowing the member firms to collaborate for sales after R&D cooperation. These two facts and the features characterizing applied research seem to suggest that authorities in charge of determining the legality of an applied R&D cooperation might reasonably suspect the existence of a broader agreement including the joint exploitation of the cooperative R&D outcome. Moreover, they lead to recommendations for R&D cooperation policy-makers. Programs promoting R&D cooperation need, in order to be efficient, to provide different incentives depending on whether applied or fundamental R&D is at stake. Similarly, a different internal organization might be required. Copyright Year 1994 Copyright type All rights reserved -
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