From evolution to co-evolution – An empirical study of the role of innovation, policy and public research in industrial dynamics

In the past decades since Schumpeter’s influential writings economists have pursued research to examine the role of innovation in certain industries on firm as well as on industry level. Researchers describe innovations as the main trigger of industry dynamics, while policy makers argue that research and education are directly linked to economic growth and welfare. Thus, research and education are an important objective of public policy. Firms and public research are regarded as the main actors which are relevant for the creation of new knowledge. This knowledge is finally brought to the market through innovations. What is more, policy makers support innovations. Both actors, i.e. policy makers and researchers, agree that innovation plays a central role but researchers still neglect the role that public policy plays in the field of industrial dynamics. Therefore, the main objective of this work is to learn more about the interdependencies of innovation, policy and public research in industrial dynamics. The overarching research question of this dissertation asks whether it is possible to analyze patterns of industry evolution – from evolution to co-evolution – based on empirical studies of the role of innovation, policy and public research in industrial dynamics. This work starts with a hypothesis-based investigation of traditional approaches of industrial dynamics. Namely, the testing of a basic assumption of the core models of industrial dynamics and the analysis of the evolutionary patterns – though with an industry which is driven by public policy as example. Subsequently it moves to a more explorative approach, investigating co-evolutionary processes. The underlying questions of the research include the following: Do large firms have an advantage because of their size which is attributable to cost spreading? Do firms that plan to grow have more innovations? What role does public policy play for the evolutionary patterns of an industry? Are the same evolutionary patterns observable as those described in the ILC theories? And is it possible to observe regional co-evolutionary processes of science, innovation and industry evolution? Based on two different empirical contexts – namely the laser and the photovoltaic industry – this dissertation tries to answer these questions and combines an evolutionary approach with a co-evolutionary approach. The first chapter starts with an introduction of the topic and the fields this dissertation is based on. The second chapter provides a new test of the Cohen and Klepper (1996) model of cost spreading, which explains the relationship between innovation, firm size and R&D, at the example of the photovoltaic industry in Germany. First, it is analyzed whether the cost spreading mechanism serves as an explanation for size advantages in this industry. This is related to the assumption that the incentives to invest in R&D increase with the ex-ante output. Furthermore, it is investigated whether firms that plan to grow will have more innovative activities. The results indicate that cost spreading serves as an explanation for size advantages in this industry and, furthermore, growth plans lead to higher amount of innovative activities. What is more, the role public policy plays for industry evolution is not finally analyzed in the field of industrial dynamics. In the case of Germany, the introduction of demand inducing policy instruments stimulated market and industry growth. While this policy immediately accelerated market volume, the effect on industry evolution is more ambiguous. Thus, chapter three analyzes this relationship by considering a model of industry evolution, where demand-inducing policies will be discussed as a possible trigger of development. The findings suggest that these instruments can take the same effect as a technical advance to foster the growth of an industry and its shakeout. The fourth chapter explores the regional co-evolution of firm population size, private-sector patenting and public research in the empirical context of German laser research and manufacturing over more than 40 years from the emergence of the industry to the mid-2000s. The qualitative as well as quantitative evidence is suggestive of a co-evolutionary process of mutual interdependence rather than a unidirectional effect of public research on private-sector activities. Chapter five concludes with a summary, the contribution of this work as well as the implications and an outlook of further possible research.

Creation and merging of ontology top-levels

We provide a new method for systematically structuring the top-down level of ontologies. It is based on an interactive, top-down knowledge acquisition process, which assures that the knowledge engineer considers all possible cases while avoiding redundant acquisition. The method is suited especially for creating/merging the top part(s) of the ontologies, where high accuracy is required, and for supporting the merging of two (or more) ontologies on that level.

Verbal proficiency as fitness indicator: Experimental and comparative research on the evolutionary psychology of language and verbal displays

Summary: Recent research on the evolution of language and verbal displays (e.g., Miller, 1999, 2000a, 2000b, 2002) indicated that language is not only the result of natural selection but serves as a sexually-selected fitness indicator that is an adaptation showing an individual’s suitability as a reproductive mate. Thus, language could be placed within the framework of concepts such as the handicap principle (Zahavi, 1975). There are several reasons for this position: Many linguistic traits are highly heritable (Stromswold, 2001, 2005), while naturally-selected traits are only marginally heritable (Miller, 2000a); men are more prone to verbal displays than women, who in turn judge the displays (Dunbar, 1996; Locke & Bogin, 2006; Lange, in press; Miller, 2000a; Rosenberg & Tunney, 2008); verbal proficiency universally raises especially male status (Brown, 1991); many linguistic features are handicaps (Miller, 2000a) in the Zahavian sense; most literature is produced by men at reproduction-relevant age (Miller, 1999). However, neither an experimental study investigating the causal relation between verbal proficiency and attractiveness, nor a study showing a correlation between markers of literary and mating success existed. In the current studies, it was aimed to fill these gaps. In the first one, I conducted a laboratory experiment. Videos in which an actor and an actress performed verbal self-presentations were the stimuli for counter-sex participants. Content was always alike, but the videos differed on three levels of verbal proficiency. Predictions were, among others, that (1) verbal proficiency increases mate value, but that (2) this applies more to male than to female mate value due to assumed past sex-different selection pressures causing women to be very demanding in mate choice (Trivers, 1972). After running a two-factorial analysis of variance with the variables sex and verbal proficiency as factors, the first hypothesis was supported with high effect size. For the second hypothesis, there was only a trend going in the predicted direction. Furthermore, it became evident that verbal proficiency affects long-term more than short-term mate value. In the second study, verbal proficiency as a menstrual cycle-dependent mate choice criterion was investigated. Basically the same materials as in the former study were used with only marginal changes in the used questionnaire. The hypothesis was that fertile women rate high verbal proficiency in men higher than non-fertile women because of verbal proficiency being a potential indicator of “good genes”. However, no significant result could be obtained in support of the hypothesis in the current study. In the third study, the hypotheses were: (1) most literature is produced by men at reproduction-relevant age. (2) The more works of high literary quality a male writer produces, the more mates and children he has. (3) Lyricists have higher mating success than non-lyric writers because of poetic language being a larger handicap than other forms of language. (4) Writing literature increases a man’s status insofar that his offspring shows a significantly higher male-to-female sex ratio than in the general population, as the Trivers-Willard hypothesis (Trivers & Willard, 1973) applied to literature predicts. In order to test these hypotheses, two famous literary canons were chosen. Extensive biographical research was conducted on the writers’ mating successes. The first hypothesis was confirmed; the second one, controlling for life age, only for number of mates but not entirely regarding number of children. The latter finding was discussed with respect to, among others, the availability of effective contraception especially in the 20th century. The third hypothesis was not satisfactorily supported. The fourth hypothesis was partially supported. For the 20th century part of the German list, the secondary sex ratio differed with high statistical significance from the ratio assumed to be valid for a general population.