Measuring the Efficiency of Regional Innovation Systems - An Empirical Assessment

We measure the efficiency of regional innovation systems (RIS) in Germany by means of a knowledge production function. This function relates private sector Research and Development (R&D) in a region to the number of inventions that have been registered by residents of that region. Two approaches are followed. First, it is assumed that differences in the productivity of private sector R&D between regions affect the slope of the KPF, which represents the marginal productivity of R&D input. The second approach assesses regional differences within the framework of a stochastic frontier knowledge production function. This approach mainly reveals differences with regard to the intercept of the knowledge production function and, therefore, with regard to the average productivity. We compare the results of both approaches and discuss a number of critical issues such as the properties of the distribution of efficiencies, the appropriate size of RIS, and how to deal with the issue of spatial autocorrelation.

[1]  Hariolf Grupp,et al.  Commuters and the regional assignment of innovative activities: A methodological patent study of German districts , 2005 .

[2]  Michael Fritsch,et al.  Gründungen in Deutschland: Datenquellen, Niveau und räumlich-sektorale Struktur , 2002 .

[3]  Egon Franck,et al.  Gegen die Mythen der Hochschulreformdiskussion - Wie Selektionsorientierung, Nonprofit-Verfassungen und klassische Professorenbeschäftigungsverhältnisse im amerikanischen Hochschulwesen zusammenpassen , 2000 .

[4]  P. Swann,et al.  Do firms in clusters innovate more , 1998 .

[5]  M. Enright.  Regional Clusters: What We Know and What We Should Know , 2003 .

[6]  Michael Fritsch,et al.  Do regional systems of innovation matter , 2003 .

[7]  Michael Fritsch.  Zum Zusammenhang zwischen Gründungen und Wirtschaftsentwicklung , 2004 .

[8]  Michael Fritsch,et al.  Regional Growth Regimes Revisited - The Case of West Germany , 2004 .

[9]  Michael Fritsch,et al.  Growth Regimes over Time and Space , 2002 .

[10]  W. Greene.  Frontier Production Functions , 1993 .

[11]  Michael Fritsch.  How and Why Does the Efficiency of Regional Innovation Systems Differ , 2003 .

[12]  Michael Fritsch.  Technologietransfer durch Unternehmensgründungen: Was man tun und realistischerweise erwarten kann , 2004 .

[13]  A. Jaffe.  Real Effects of Academic Research , 1989 .

[14]  Rosina Moreno,et al.  Geographical and sectoral clusters of innovation in Europe , 2005 .

[15]  M. Fritsch,et al.  Contests for Cooperation - A New Approach in German Innovation Policy , 2005 .

[16]  Egon Franck,et al.  Anreizsysteme für Professoren in den USA und Deutschland - Konsequenzen für Reputationsbewirtschaftung, Talentallokation und die Aussagekraft akademischer Signale , 2000 .

[17]  A. U.S.,et al.  FORMULATION AND ESTIMATION OF STOCHASTIC FRONTIER PRODUCTION FUNCTION MODELS , 2001 .

[18]  W. Meeusen,et al.  Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error , 1977 .

[19]  Michael Fritsch,et al.  Measuring the Quality of Regional Innovation Systems: A Knowledge Production Function Approach , 2002 .

[20]  Maryann P. Feldman,et al.  Real Effects of Academic Research: Comment , 1992 .

[21]  M. Fritsch,et al.  Innovation, regional knowledge spillovers and R&D cooperation , 2004 .

[22]  Michael Fritsch,et al.  R&D Co-Operation Between Public Research Institutions: Magnitude, Motives and Spatial Dimension , 2002 .

[23]  Attila Varga,et al.  Local Geographic Spillovers between University Research and High Technology Innovations , 1997 .

[24]  Michael Fritsch,et al.  The Establishment File of the German Social Insurance Statistics , 2004, Journal of Contextual Economics – Schmollers Jahrbuch.

[25]  Dieter Jacob,et al.  Aktuelle baubetriebliche Themen - 2002/2003 , 2004 .

[26]  Michael Fritsch,et al.  Von der innovationsorientierten Regionalförderung zur regionalisierten Innovationspolitik , 2003 .

[27]  M. Meeus,et al.  Firm clustering and innovation: Determinants and effects , 2001 .

[28]  M. Meeus,et al.  Firm clustering and innovation , 2001 .

[29]  Michael Fritsch,et al.  Entrepreneurship, entry and performance of new business compared in two growth regimes: East and West Germany , 2004 .

[30]  M. Porter.  Clusters and the new economics of competition. , 1998, Harvard business review.

[31]  L. Anselin.  Spatial Econometrics: Methods and Models , 1988 .

[32]  Zvi Griliches,et al.  Issues in Assessing the Contribution of Research and Development to Productivity Growth , 1979 .

[33]  Michael Fritsch,et al.  Cooperation and the efficiency of regional R&D activities , 2004 .

[34]  R. Geary,et al.  The Contiguity Ratio and Statistical Mapping , 1954 .

[35]  Caroline Hussler,et al.  Innovation in regions: What does really matter? , 2005 .

[36]  Z. Griliches.  Patent Statistics as Economic Indicators: a Survey , 1990 .

[37]  Egon Franck,et al.  Warum gibt es Stars? Drei Erklärungsansätze , 2001 .

[38]  Maryann P. Feldman.  The geography of innovation , 1994 .

[39]  M. Farrell.  The Measurement of Productive Efficiency , 1957 .

[40]  M. Fritsch,et al.  The Role of Regional Knowledge for Innovation , 2005 .

[41]  D. Aigner,et al.  P. Schmidt, 1977,?Formulation and estimation of stochastic frontier production function models,? , 1977 .

[42]  Bruno Schönfelder.  The Impact of the War 1991: 1995 on the Croatian Economy: A Contribution to the Analysis of War Economies , 2005 .

[43]  Egon Franck,et al.  Internet-Start-ups - Ein neuer Wettbewerber unter den "Filteranlagen" für Humankapital , 2001 .

[44]  Michael Fritsch,et al.  Effects of New Business Formation on Regional Development over Time , 2004 .

[45]  Michael Fritsch,et al.  Does R&D-Cooperation Behavior Differ between Regions? , 2003 .

[46]  Michael Fritsch,et al.  Interregional Differences in R&D Activities—An Empirical Investigation , 2000 .

[47]  Attila Varga,et al.  Geographical Spillovers and University Research: A Spatial EconometricPerspective , 2000 .

[48]  L. Anselin,et al.  Patents and innovation counts as measures of regional production of new knowledge , 2002 .

[49]  Hurvey Leibenstein.  Allocative efficiency vs. X-Efficiency , 1966 .

[50]  Manfred M. Fischer,et al.  Spatial knowledge spillovers and university research: Evidence from Austria , 2003 .

[51]  Luc Anselin,et al.  Some robust approaches to testing and estimation in spatial econometrics , 1990 .