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Firm scope and spillovers from new product innovation : evidence from medical devices

Author: Matthew Grennan; Charu N Gupta; Mara Lederman; National Bureau of Economic Research,
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2018.
Series: Working paper series (National Bureau of Economic Research), no. 25183.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
When firms span related product categories, spillovers across categories become central to firm strategy and industrial policy, due to their potential to foreclose competition and affect innovation incentives. We exploit major new product innovations in one medical device category, and detailed sales data across related categories, to develop a causal research design for spillovers at the customer level. We find  Read more...
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Details

Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Matthew Grennan; Charu N Gupta; Mara Lederman; National Bureau of Economic Research,
OCLC Number: 1060609959
Notes: "October 2018"
Description: 1 online resource (42 pages) : illustrations.
Series Title: Working paper series (National Bureau of Economic Research), no. 25183.
Responsibility: Matthew Grennan, Charu Gupta, Mara Lederman.

Abstract:

When firms span related product categories, spillovers across categories become central to firm strategy and industrial policy, due to their potential to foreclose competition and affect innovation incentives. We exploit major new product innovations in one medical device category, and detailed sales data across related categories, to develop a causal research design for spillovers at the customer level. We find evidence of spillovers, primarily associated with complementarities in usage. These spillovers imply large benefits to multi- vs. single-category firms, accounting for nearly one quarter of sales in the complimentary category (equivalent to four percent of revenue in the focal category).

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