Success in Pharmaceutical Research: The Changing Role of Scale and Scope Economies, Spillovers and Competition

This paper investigates the determinants of success in the development of new drugs. In specific, it explores the factors of success in drug development programs at different stages of innovation process. We use economies of scale, scope, R&D competition and technological spillovers as explanatory variables and test whether the effect of these variables on the success of a project differs in relation to the discovery and development stages of innovation, respectively. Our main finding is that spillovers, including spillovers from collaboration, are important in explaining the success of projects during the discovery stage of innovation, while in the later development stage, the effects of competition outweigh any benefits from spillovers.economies of scale and scope, spillovers, competition, R&D, innovation process

Collaboration in pharmaceutical research: Exploration of country-level determinants.

In this paper we focus on proximity as one of the main determinants of international collaboration in pharmaceutical research. We use various count data specifications of the gravity model to estimate the intensity of collaboration between pairs of countries as explained by the geographical, cognitive, institutional, social, and cultural dimensions of proximity. Our results suggest that geographical distance has a significant negative relation to the collaboration intensity between countries. The amount of previous collaborations, as a proxy for social proximity, is positively related to the number of cross-country collaborations. We do not find robust significant associations between cognitive proximity or institutional proximity with the intensity of international research collaboration. Moreover, there is no robust and significant relation between the interaction terms of geographical distance with social, cognitive, or institutional proximity, and international research collaboration. Our findings for cultural proximity do not allow of unambiguous conclusions concerning their influence on the collaboration intensity between countries. Linguistic ties among countries are associated with a higher amount of cross-country research collaboration but we find no clear association for historical and colonial linkages.International Cooperation, Pharmaceuticals, Proximity

Public spending and Scottish devolution : crowding out, or crowding in?

There has been a developing debate about the performance of the Scottish economy under devolution and the effect of the expansion of the public sector on Scottish growth. Several commentators have expressed concern that the size of the public sector in Scotland is now a drag on growth, while others take a more sanguine view. This debate is well summarised in Marsh and Zuleeg (2006). However, this is a debate in which the evidence is often not well marshalled and there is often more heat than light generated. There is a suspicion that arguments about the effect and role of the public sector often derive more from the ultimate values and political preferences of proponents than from hard analysis and evidence

A Model of the Housing Privatization Decision: The Case of Russia

This study addresses the issue of housing privatization in Russia in the course of the 1990s. Privatization was started to create a housing market in order to efficiently allocate resources in the use and production of housing, and to phase out the state budget financing of housing. The dwellings were offered to their residents free of payment. The objective of this study is to offer a better understanding of the structural components of privatization by formally modeling housing privatization decision from the household point of view. The model is based on a trade-off between certain value of renting and uncertain value of owning. Using the results of the theoretical model, an empirical model of the privatization decision from the point of view of the household is formulated.

A Cellular Automata Simulation of the 1990s Russian Housing Privatization Decision

The study uses a computational approach to study the phenomenon of housing privatization in Russia in the 1990s. As part of the housing reform flats in multi-family buildings were offered to their residents free of payment. Nevertheless rapid mass housing privatization did not take place. While this outcome admits a number of explanations this analysis emphasizes the fact that the environment in which the decision-making households were operating had a high degree of uncertainty and imposed a high information-processing requirement on the decision-makers. Using the bounded rationality paradigm, the study builds a case for a cellular automata simulation of household decision-making in the context of housing privatization reforms in Russia in the 1990s. Cellular automata is then used to simulate a household’s decision to become the owner of its dwelling.cellular automata, complex systems, housing reform, Russia, simulation

Technology, competition and the time of entry: Diversification patterns in the development of new drugs

This paper empirically investigates the determinants of R&D diversification strategies in the drug industry. It enriches the existing literature by proposing to look at diversification factors, which reflect market and technological proximity of an R&D project towards other projects within a firm's portfolio as well as R&D competition factors. Additionally, the characteristics of R&D in the market where a new potential product is developed affect future product choice. The analysis is performed for products-in-development data, merged with firms' patents, which allows us to separate project proximity in market niches from technological proximity. The results of empirical estimation support an idea that R&D diversification is governed by the economies of scope as well as the escape competition motive. Moreover, it is found that competition rather than spillovers in the niche where an R&D project is developed defines firms' decisions to diversify

Regional Productivity Differentials in Poland, Hungary and the Czech Republic

This paper starts by describing the distribution of GVA, employment and productivity growth across the regions of Poland, Hungary and the Czech Republic. Next, we investigate in what extent regional per capita income gaps to the European average can be attributed to differences in productivity per worker. Finally, we extend Esteban’s (2000) shift-share analysis to measure how regional productivity gaps are due to differences in industrial mix as opposed to region-specific factors. The results point out the greater influence of the second element and therefore support policies benefiting homogenously all the sectors in the least developed regions.Eastern Europe, Poland, Aggregate Productivity, Shift-share, Regional Policy

Productivity and Heterogeneous Knowledge: Exploring the Relationship in a Sample of Drug Developers

This paper aims to investigate the effect of knowledge characteristics on the total factor productivity of firms developing drugs in the pharmaceutical industry. We decompose knowledge into knowledge associated with the technological firm portfolio and knowledge related to R&D projects, which represent drug development at the clinical testing stage. The latter is attributed to the knowledge of relevant markets where the drugs will be sold. The results show that the effect of technological coherence vs. market coherence and of accumulated knowledge on the productivity of firms differs. Productivity increases with the number of patents and decreases with the patent diversity and project portfolio coherence. When considering only the project knowledge, the diversity of the project portfolio positively affects productivity.total factor productivity, diversity,,coherence, knowledge

Technological diversity and future product diversity in the drug industry

This paper deals with the topic of related R&D and innovation strategies of large firms. We ask what determines the diversity of a firm's product portfolio. More specifically, we try to explain large firms' expansion into new product markets driven by the characteristics of their technological knowledge. Empirically, we study firms in the pharmaceutical and biotech industries, using relevant data on product development and technological knowledge. We find a positive relationship between the diversity of a firm's future product portfolio and the diversity of its stock of technological knowledge. This relationship becomes weaker when the breadth of technological knowledge increases

Regional investment attractiveness in an unstable and risky environment

Part of: Seliger, Günther (Ed.): Innovative solutions : proceedings / 11th Global Conference on Sustainable Manufacturing, Berlin, Germany, 23rd - 25th September, 2013. - Berlin: Universitätsverlag der TU Berlin, 2013. - ISBN 978-3-7983-2609-5 (online). - http://nbn-resolving.de/urn:nbn:de:kobv:83-opus4-40276. - pp. 159–164.Investment process effectiveness, which along with investment risk and investment potential defines the investment attractiveness of a region, and, therefore, the investment climate, is also characterized by the growth of regional gross product through investments in physical and human capital. The investment attractiveness of a region is determined by comparison of two parameters reflecting the conditions in which investors’ activities take place: investment potential and investment risk. The amount of risks associated with investment activities is large, while uncertainty of their occurrence compels investors to evaluate the investment potential of a region as uncertain, too. Eliminating uncertainty in investment risk evaluation and increasing investment attractiveness of regions may be possible through application of logical and stochastic methods of evaluation, to the author's mind