Investing in R&D in the past few decades has become a routine process for both large and medium-sized technology companies. Moreover, R&D often serves the main weapon in the competition between firms. In this article, we consider two simple models for selecting the level of investment in R&D by companies. Then, on the example of leading companies from the pharmaceutical industry and automotive industry, the theoretical predictions are tested on empirical data. It turned out that on average firms from the same industry choose close norms of investment in R&D. At the same time, as a rule, firms maintain the level of R&D-intensity over time or even increase it
Keywords: R&D investment, R&D intensity, innovation development, R&D, corporate R&D investment
- The EU Industrial R&D Investment Scoreboard. http://iri.jrc.ec.europa.eu/scoreboard.html.
- Baumol, J. William. Entrepreneurship, Innovation and Growth: The David-Goliath Symbiosis//Journal of Entrepreneurial Finance and Business Ventures: Vol. 7: Iss. 2, 2002. P. 1-10.
- Baumol, J. William. The Microtheory of Innovative Entrepreneurship. Princeton University Press, 2010.
- F. R. Lichtenberg. R&D investment and international productivity differences//NBER Working Paper № 4161. 1992.
- R. E. Lucas. On mechanisms of economic development//Journal of monetary Economics 22.1, 1988. P. 3-42.
- P. Romer. Increasing returns and long-run growth//Journal of Political Economy, 94, 1986. P. 1002-1037.
- P. Romer. Endogenous technological change//Journal of Political Economy, 9805, 1990. P. 71-102.
- M. Trajtenberg. Economic Analysis of product innovation. Cambridge University Press. Cambridge, 1990.