EWEPA Conference location:Pisa (Italy) date:25-26 June 2009
This paper evaluates the impact of basic research on the technological performance of firms. We distinguish between self-performed basic research (internal basic research) and the exploitation of external basic research findings in firms’ technology activities (external basic research). We hypothesize that firms that engage in internal basic research increase their technological performance, in particular when these activities are undertaken in collaboration with academics. In addition, a positive impact of the exploitation of external basic research findings is expected. Finally, we argue that internal basic research and the usage of external basic research are complementary activities in the sense that internal basic research provides firms with the skills and methods to exploit external basic research more effectively in their technology activities. Empirical support for our hypotheses is found in a panel data (1995-2002) analysis of the patent and publication activities of 33 of the largest R&D spending pharmaceutical firms in the world.