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Final report for research project: Mesures micro- et macroéconomiques des activités innovantes au sein des enterprises

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abstract The project “Mésures microéconomiques des activités innovantes au sein des enterprises” was a bilateral research project between the Swiss Federation, represented by the Swiss Federal Office of Statistics (henceforth abbreviated OFS / BFS) and the Institute of Technology Management at the University of St. Gallen (project leader: Dr. Marcus M. Keupp). The project was conducted from April 1, 2008 to March 31, 2010.

Overall, the purpose of this project was to assess the current state of how innovation activities of firms are measurement on the microeconomic level, to assess interdependencies of this measurement with how innovation is accounted for in the macroeconomic system of current accounts (CN), and to suggest possibilities of how to address these areas for the future.
Since in developed economies, innovation is the factor by which economic growth is spurred, the consideration of these questions is paramount. This specifically applies to a nation like Switzerland that lacks natural resources and is thus dependent on the innovativeness of its firms to achieve market leadership by superior products and production processes and thus economic growth. Therefore, the project had the following five express goals (in brackets: original quotation from the project treaty):

* To deliver a full account of microeconomic measurement instruments and a concept of how they can be linked to macroeconomic accounting (Mise sur pieds d’un inventaire des sources statistiques à disposition pour faire une étude sur l’innovation. Cet inventaire doit dépasser les données de l’enquête sur l’innovation qui est conduite périodiquement en Suisse, et inclure en particulier des réflexions sur la valeur ajoutée brute et la productivité multifactorielle);
* To deliver microeconomic measurement models that allow the cause-and-effect relationships of innovation activities, including the reconciliation of these measures with macroeconomic accounting (Détermination d’un catalogue de variables microéconomiques qui permet de mesurer la relation de cause à effet entre les efforts de l’innovation, la productivité et la croissance d’une entreprise, d’une branche d’activité respectivement d’un pays. Ces données doivent être compatibles et utilisables dans un cadre macroéconomique tel que le système de comptabilité nationale, ce qui implique que les variables doivent respecter les critères du système de comptabilité nationale et doivent pouvoir être utilisées dans un contexte macroéconomique);
* To develop a conceptual model that allows to track the production and diffusion processes of innovation within and between firms, and to reconcile this model with macroeconomic measurement (Elaboration d’un modèle conceptuel (Input-Throughput-Output) reflétant le processus de création et de diffusion de l’innovation au sein des entreprises et entre les entreprises. Ce modèle doit permettre d’établir une relation entre la micro et la macroéconomie)
* To develop an econometric measurement concept that allows to operationalise the above conceptual frawork (Mise sur pieds d’un développement économétrique qui intègre ce nouveau cadre conceptual)
* To observe special effects from non-technological innovation as well as to account for the difference between innovating and non-innovating firms (Veille à distinguer les innovations technologiques des innovations non-technologiques et considère également les entreprises non-innovantes).

The reasons for setting up this project and these specific goals stem from the fact that the current measurement of innovation activities is fraught with serious problems on the microeconomic level, and there is only a minor recognition of innovation activities in the current system of national accounts. These problems lead, on the one hand, to a systematic understatement of the share of gross domestic product (GDP) growth that is attributable to innovation. On the other hand, microeconomic measurement is currently fraught with considerable measurement error since the instruments and measurement models used to assess innovative activities are debatable. Throughout this report these problems are specifically highlighted and commented where appropriate.

The project has elaborated three detailed reports in which recommendations to alleviate these problems. Further, it has developed a framework for reforming the macroeconomic accounting of firms’ innovation activities, and it has developed a microeconomic survey instrument that is ready for implementation. Thus, the project results are able to address the five goals of the project as follows:

* The report delivers a full account of existing microeconomic measurement instruments, provides a critique of these measures as well as of current statistical implementation practices in the EU and in Switzerland.
* The microeconomic measurement instrument that was developed contains 22 econometric measurement models that allow to measure the cause-and-effect relationships of innovation activities. The report contains and comments on these. The instrument is econometrically sound and ready for implementation. It accounts for special effects from non-technological innovation as well as for the difference between innovating and non-innovating firms.
* Both of these developments are based on a microeconomic input-throughput-output model and reconciled with the framework for the macroeconomic accounting of innovation the project has elaborated. It is proposed how microeconomic innovation activities may be better accounted for in a macroeocnomic frame of reference, and how the above proposals for microeconomic measurements can better inform the current system of national accounts. Further, the report reconciles these recommendation with related developments in other parts of the world.

The remainder of this report explicates these contributions in greater detail. It is structured in three sections that each explicate the three singular reports this project has elaborated. The full reports can be found in the annex of this document. In each of the three sections, special policy recommendations are elaborated. Finally, the last section integrates these reports into overall policy recommendations to support decision-making at the OFS / BFS.
type working report (English)
project Microeconomic measurement of firm-level innovation
date of appearance 2010
publisher Swiss Federal Office of Statistics (Neuchâtel)
review external review
citation Keupp, M. M. (2010). Final report for research project: Mesures micro- et macroéconomiques des activités innovantes au sein des enterprises. Neuchâtel: Swiss Federal Office of Statistics.