Understanding Private-Sector Decision Making for Early-Stage Technology Development. A 'Between Invention and Innovation Project' Report

摘要

Financial market failures create obstacles to the commercialization of science-based innovations originating from inventors and technology entrepreneurs. Such obstacles deny the economy new sources of revitalization and future growth. Studies of this topic have tended to focus on the particular challenges associated with bringing new ideas to market through the creation of a new firm. Start-up firms are particularly appropriate vehicles for more radical innovations (characterized by both technical and market novelty). Established enterprises are typically more successful in pursuing incremental extensions to existing technologies and markets. But what about radical innovations that fall within the business strategy of larger firms. Since the overwhelming majority of U.S. industrial research and development (R&D) expenditures come from large firms ($180.4 billion invested into R&D by U.S. industrial firms in 2000) surely large firms face fewer financial barriers to bringing radical innovationsincluding those stemming from their own corporate research into their businesses. This is the line of reasoning followed by some critics of government funded research partnerships with large and other size firms. That large firms have real difficulty creating radical innovations outside the core areas of business to which they are committed is well understood. This report shows that large firms may experience similar failures when trying to exploit high technology innovations that apply directly to markets already served by the firm.