dc.description.abstract | Due to the arrival of knowledge economy, in this rapid change technology and the keenly competitive environment, innovation has been taken seriously beyond the traditional input factors such as capital and labor. Innovation performance of Taiwan is active and glaring in the world. According to the statistics from the U.S. Patent trademark office, Taiwan’s patent count per capita is the world number one in recent years. This dissertation adopts the data of Taiwanese industries and firms to explore the following three innovation issues, the effect of firms’ characteristics on innovation activities, the role of technological diversification in innovation and market performance, and the causal relationship between innovation, capital investment, and market value.
In chapter 2, in order to collect the data of small and medium-sized enterprises (SMEs), we survey the firms who granted at least one patent in 2006. Our purpose is to explore the impact of firm’s characteristics on its innovation activity within traditional and high-tech and within non-SMEs and SMEs firms. By adopting the zero-truncated negative binomial model, we show that the creative knowledge accumulation, proxied by the patent grants in the previous 6 years, makes a significant positive contribution to its innovation in both high-tech and traditional sectors, and both non-SMEs and SMEs firms. In addition, our empirical results revealed that the firm size and export ratio have a positive relationship with innovation in high-tech industry, but not significant in traditional industry. Furthermore, R&D expenditure and firm age have reverse effects in high-tech and traditional sectors.
Since the creative knowledge accumulation plays an important role in innovation, in chapter 3, we examine whether innovation enhances the technological diversification, and analyze the role of technological diversification in market performance. By analyzing 630 Taiwanese electronic listed firms during 1990-2008, we show that the firms with active innovation tend to expand their technology scope, and the technological diversification contributes to market performance such as return on equity and sales.
As the third issue in chapter 4, by using Taiwan’s annual data for the period 1988-2005, we analyze the causal relationship between technological innovation, capital investment, and market performance for four major industries with different technological levels, namely, the electronics, chemical, machinery and textile industries. We focus on whether or not innovation leads to the growth of industrial development and further investment in capital. In addition, we explicitly examine innovation stimulates the market performance of an industry by incorporating heterogeneity into these industries. Our results show that the completely bilateral causal relationship between innovation, capital investment, and production value can only be found in the high-tech electronics industry in Taiwan. Some missing linkages are still found in terms of technological innovation in the mid-tech and traditional industries. We can serve the creation of virtuous causal cycles as an important element in an integrated innovation strategy.
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