Technological opportunity and economies of scale in research productivity: A study on three global industries

In this study, the author tests for economies of scale with the use of patent citations and assesses the impacts of technological opportunity on research productivity in three global industries, namely, computer, chemical, and electrical and electronic. Technological opportunity in an industry is jointly represented by knowledge spillovers, inter-firm research overlap and scope of research. In particular, the effect of knowledge spillovers is decomposed into internal, intra-industry and inter-industry spillovers. The results suggest no evidence for economies of scale, but the impacts of various aspects of technological opportunity on research productivity are significantly positive. Moreover, the data indicate that if the number of firms in each overlapping research area is small, a rise in the number of these areas enhances research productivity.