This article shows - on both conceptual and empirical grounds - the importance of business cycles in affecting key relationships between innovation and international performance. While periods of upswing are characterised by a well documented 'virtuous circle'. between innovation inputs, new...

We analyze the impact of obsolescence of economic inventions by incorporating maintenance costsin the endogenous growth model of expanding product varieties. This contrasts with the existingliterature, which ignores maintenance costs and uses the model of quality improvements todescribe...

This study analyses those country characteristics, which lead those regions to become as productive operation and innovation environments for firms and research centres. This study shows that those countries who invest wisely to develop their innovation environment will be successful in high...

We explore the potential roles of industrial policy in the transition from middle-income to high-income status, and the actual experience of industrial policy in emerging economies. Guided by the conceptual framework of the neo-Schumpeterian approach, we look at industrial policy in the context...

A major international transmission channel of productivity increases is trade in intermediate products and services. This paper analyses international rent spillovers at the industry level and for the first time investigates effects from the service sector in this international framework. The...

North-South foreign direct investment (FDI) is frequently viewed as a process in which jobs relocate from the North to the South. I build a growth model with two asymmetric trading economies, the North where firms innovate and the South where Northern firms invest to take advantage of lower...

We analyze the growth and welfare effects of globalization in a dynamic Schumpeterian North-South product-cycle model. Economic growth is driven by R&D activities of Northern entrepreneurs. Top Northern production technologies are imitated by the South. In the North, there is wage bargaining...

We examine the impact of the strictness of employment protection legislation on innovation intensity. To this purpose, we use a panel of annual data from OECD countries over the period 1990-1999 and estimate difference-in-difference models to explain the variation of innovation intensity between...

We also show that the evidence that knowledge spillovers flow along the supply chains is more robust than the traditional finding that knowledge spillovers depend on geographical distance or trade flows. Our findings support policies that favour participation in supply chains to foster economic...

This volume was prepared by Sebastian Benz while he was working at the Ifo Institute. It was completed in December 2013 and accepted as a doctoral thesis by the Department of Economics at the University of Munich. It includes five self-contained chapters. All chapters discuss different...