Innovation activity of corporations in emerging economies

Transcription

1 Innovation activity of corporation in emerging economie Ekaterina N. Soboleva 1a, Mikhail V. Chikov 2, and Anataia S. Zaikovkaya 1 1 National Reearch Tomk Polytechnic Univerity, Tomk, , Ruia 2 National Reearch Tomk State Univerity, Tomk, , Ruia Abtract. The paper conider macro parameter of corporation innovation activity in the BRICS countrie. The author determine trannational corporation behavior trategie in the context of creating and tranferring new knowledge, where developed countrie (the USA, European countrie and Japan) play an important role and take a leading poition in thi proce. Companie from emerging economie focu on uing and adopting innovation. The reaon for thi i that knowledge "i coded" pecifically, conequently the participant of it exchange have to be in imilar intellectual pace. Neverthele, the market-leading corporation from the BRICS countrie join the world chain of innovation creation, building their network to atify their branche need concerning technological deciion and peronnel training Introduction Developing of the BRIC countrie ha become a prominent iue in the lat decade. The term wa created by J. O`Neill to identify four larget emerging economie Brazil, Ruia, India, and China [1]. A few year ago, South Africa joined BRIC. Their economic potential i getting increaing attention in the cientific community. Wherea expert dicu their propect of becoming economic and political power [1, 2], keptic argue that BRICS ha a heterogeneou tructure, and thee countrie face different problem in realizing their economic potential [3]. A central theme in the analyi of emerging economie, epecially BRICS, i the importance of innovation-driven development [4]. Since the end of the XX century, they have been making effort to tranform their innovation ytem and to build an infratructure for dometic innovation activitie. Corporation are playing the key role in thee procee. Their activity i determined by variou factor uch a intitutional framework, mechanim of interaction between large firm, tate, and reearch center, corporate culture, market hare, and other factor. The paper propoe defining ome parameter of innovation intenity in the BRICS countrie. The paper i divided in three ection. Section I take a brief look at the macroeconomic context of innovation development in BRICS. In Section II, we concentrate on the role of the tate in national innovation ytem. Knowledge ue and creation trategie, performed by TNC in emerging economie, are decribed in Section III. Macroeconomic indicator of innovation development in BRICS In the lat decade, the trannational corporation (TNC) from emerging economie have trengthen their preence on the world market trying to ecure top poition in dometic economy and to get acce to the foreign technologie and reource. TNC have increaingly globalized their innovation activity. Although, it meaure i hindered becaue of the lack of the pecific data, we can ue ome macroeconomic indicator, uch a gro expenditure on reearch and development (GERD), charge for ue of intellectual property etc. The BRICS countrie teadily increae the expenditure on reearch and development (R&D). Table 1. GERD in BRICS countrie, Bln % Bln % Bln % Bln % PPP$ GDP PPP$ GDP PPP$ GDP PPP$ GDP Brazil 27,9 1,2 29,5 1, ,3 33 1,3 Ruia 35,7 1, , ,5 40 1,5 India 38,4 0,85 40,3 0, , ,9 China 177,3 1,55 197,3 1, , ,0 South Africa 5,3 0,95 5,5 0,95 6 1,0 6 1,0 a Correponding author: oboleva88@tpu.ru The Author, publihed by EDP Science. Thi i an open acce article ditributed under the term of the Creative Common Attribution Licene 4.0 (

2 In particular, China demontrate the growth of R&D-intenity and take the 2nd place in the world pending approximately 300 billion US dollar on R&D (table 1). The expert expect that China will urpa the U.S. by about [5] Table 2. Charge for ue of intellectual property in the BRICS countrie, the USA, and Japan (billion US dollar) Payment Receipt Payment Receipt Payment Receipt Brazil 3666,5 510,7 3668,6 597,2 5922,7 375,1 China 17748,9 1044, ,1 886,7 India 3990,1 321,4 3904,0 445,6 4848,7 658,7 Ruia 7629,3 664,2 8370,8 737,9 8021,4 665,8 South 2017,1 124,9 1936,8 120,0 1732,0 116,5 Africa Japan 19897, , , , , ,6 USA 38660, , , ,0 Actually, firm from emerging economie rank among the larget uer of the intellectual property. Baed on tatitical data [6, 7], we can conclude that in contrat to developed countrie payment for uing patent, trademark, copyright, indutrial procee and deign etc. in emerging economie exceed receipt for uing proprietary right (table 2). Nowaday TNC from emerging economie got acce to the world market owing to low-cot production, but it reult in aggravation of competition between dometic and foreign capital [5]. Therefore, they have to reach their competitivene through increaing R&D-activity and maintain cot leaderhip at the ame time. In general, emerging economie (except China) demontrate lower innovation intenity than developed one. Although China focue on adopting innovation, it create them a well. In the receipt for ue of intellectual property in Chinee economy were redoubled. The BRICS countrie have different innovation potential. Ruia produce more than 3000 cientit per million people. It i a bit le than in Europe or the USA, wherea India, Brazil continue lagging behind thoe figure (Figure 1). Fig. 1. Indicator of innovation activity Neverthele, the coniderable part of large Indian and Brazilian firm implement innovation, but their type are different acro countrie. For intance, in Brazil the product/proce and marketing/organizational innovation predominate. Indian companie concentrate on marketing/organizational innovation only (Figure 2) [8]. Apparently, uch difference are determined by the national innovation ytem. Brazilian and Indian market are attractive for foreign TNC becaue of their capacity. It lead to implementation of marketing/organizational innovation. High-level availability of education in Ruia reult in more application for a patent. However, the quality of thee innovation i relatively low. The mot part of Ruian corporation tend to perform a trategy of innovative imitation. For intance, they have bought new equipment or implemented exiting buine model in order to make production proce more flexible and efficient. Neverthele, cot reduction or employment ecurity were not taken into conideration. Fig. 2. Type of innovation performed by large firm, % 2

3 It hould be emphaized, that innovation intenity in Ruian corporation wa higher when they were ued to invet in R&D, and have technical culture. Conequently, innovation activity i peripheral to corporate trategy of the mainly part of Ruian large firm, and it i primarily aimed for increae of financial effectivene wherea labor productivity grow lowly. Nowaday labor productivity in Ruian corporation i four time lower than in the USA, three time lower than in European countrie, and 1.6 time lower than in China. Foreign TNC exert a ubtantial impact on innovation activity in emerging economie. They compete trongly againt the dometic firm, and conequently encourage implementing of innovation. The economic relationhip between foreign and dometic capital i contradictive. On the one hand, foreign TNC are intereted in the acceptable rate of return and increae of their aet value. On the other hand, they do not aim at maintaining the welfare in a recipient country. The dometic firm contact with foreign TNC in the following form [9]: Production of the imilar good; Supply of raw material and component for foreign firm; Ue of raw material and component from foreign firm; Ditribution of TNC` product on the dometic market. Fig.3 Economic relationhip between dometic and international buine [9, p. 204] In general, we can ditinguih ome competitive trategie performed by dometic firm (Figure 3): Compete againt foreign TNC; Make a earch for gap in the market; Merge into foreign TNC; Market exit. Thee trategie (except market exit) aume that firm have to adapt their behavior to the new circumtance. Therefore, we can ugget that high demand for marketing and organizational innovation in emerging economie i determined by increaed competition on the dometic market. Interacting with international buine, firm get acce to a range of innovation from new product and technologie ( vertical invetment) to new buine model ( horizontal invetment). Nowaday, TNC prefer to inject vertical invetment, which are aimed at value chain creation. However, they pay attention to the ocial capital formation to decreae bargaining cot. Thu, we emphaize that innovation activity in emerging economie depend on cooperation between key actor: foreign and dometic firm, and tate a well. State and innovation activity of the large firm It i widely agreed that the mot important economical function of the tate are to etablih contract - enforcement intitution, maintain economic tability, and provide ocial welfare. Performing thee function, tate etablihe property right intitution. Firtly, it mean that tate control acce to carce good, epecially to non-renewable reource, in order to meet the ociety` need. Secondly, tate ha to define property right. Thu, government intervention in market proce i baed on the tate` enforcement monopoly. Thirdly, repreenting ocial interet, tate ha a right to limit the ue of privet property in order to provide opportunitie for economic growth and development. In pite of the fact that regulatory taking ha been criticized, it can, under certain condition, promote innovation. Fourthly, tate, inducing intitutional change, can create new form of interaction among the exiting agent and intitution. The analyi of property right intitution in Ruian economy give u evidence that inefficient interaction between tate and corporation lead to innovation activity decreae. It reult in rent-eeking behavior and diparity between corporate actor. Stakeholder, who are taking real corporate control, erve their interet at the expene of other takeholder. Thi phenomenon can be decribed a an intitutional trap [10]. Within the trap, economic actor trive to achieve good financial reult to obtain momentary advantage. However, they are not able to create permanent innovation culture. Neverthele, tate i ignificantly increaing it influence on economic activity in developing countrie. For intance, it pend a ubtantial part of invetment into fundamental reearch. Thi give u evidence that the tate trie to perform innovation activity intead of private buine. There are ome reaon for the tate to invetigate in R&D: 3

4 Increae of the market hare in the global economy; Implementation of indutrial policy and promotion of economic activity; Augmenting of country` innovation potential; Improvement in labor force quality. Thu, the tate ha to reconcile the interet of ociety, dometic and foreign buine. Knowledge tranfer trategie: adoption v. creation There are two trategie of knowledge ue and creation, practicing by TNC from emerging economie [11]. The firt (aet-exploiting trategy) involve a tranfer of intellectual capital, created in the home country, to TNC` overea department. Within the aet-exploiting trategy, there are two type of firm: 1. Modifier they do not conduct a full R&D-cycle, but they adopt innovation to improve their product and procee. 2. Uer of technologie they borrow innovation developed by other firm. A a reult, firm-recipient gain acce to the new technological olution. Such activity ha been pread worldwide, epecially in the BRICS countrie with their developing market. The reaon for thi i a low degree of national innovation ytem competitivene. Moreover, TNC are often intereted only in finding new market for their product in hot countrie [12]. The econd trategy (aet-augmenting) mean that knowledge wa created by overea department of TNC and tranferred to the headquarter to ue within the TNC. Implementation of thi trategy require building inter-firm chain for information exchange. The key problem i that knowledge i coded in pecial way; therefore, all participant of it tranfer have to be in the imilar intellectual pace. That i why the mot TNC concentrate their innovation activity in the Triad (USA, Europe, and Japan). Neverthele, large firm from emerging economie proceed with the aet-augmenting trategy and create their own innovation cluter. Being technological leader, TNC feel up to collaborate with the different ubject of national innovation ytem (univeritie, firm etc.) and promote demand for R&D, and taff training a well. Some companie from BRICS ucceed in thi trategy. For intance, Embraer (Brazilian 3 rd -bigget aeropace company in the world) play a key role in value added chain united relationhip between deign engineer, component upplier, and producer. Furthermore, nearly 98% of component are produced abroad, but aembly proce i located in Brazil. The main contribution to the Embraer` ucce wa made by pecial innovation infratructure, created in the Technology Valley São Joé do Campo. Supporting innovation activity include collaboration with reearch center and intitute. According to agreement between Embraer and SENAI (National Indutrial Learning Service), the ervice provided training for 40 tudent on behalf of the company. In return, Embraer had to build a modern laboratory for SENAI in São Joé do Campo to carry out invetigation in the area of telecommunication [13]. Therefore, in pite of a relatively mall ize TNC from emerging economie try to increae innovation activity and incorporate into global chain of creating and tranferring knowledge. Concluion We can tate that there are different trend in procee of innovation creation and implementation in emerging economie. On the one hand, TNC operated in technology intenive field (uch a IT, pharmaceutical indutry etc.) have trong poition on dometic and, in ome cae, on the world market. Thee branche are characterized by a high level of expenditure on R&D, patent application and grant activity and competitive ability. On the other hand, they have come hort of innovation potential uage; poitive dynamic of innovation development i motly connected with particular qualitie of rapid growth on certain world market. In contrat to the developed countrie, tate play key role in innovation ytem of emerging economie. Beide ecurity and enforcement of property right, it ha to pend a ignificantly amount of money to encourage innovation becaue of high vulnerability of developing economie. Thu, tate invetment ubtitute for privet one, epecially during the economic crii. Acknowledgement Thi reearch wa financially upported by the National Reearch Tomk Polytechnic Univerity Reference 1. J. O`Neill, Goldman Sach Glob. Econ. Paper, 66, (2001) 2. H.F. Cheng, M. Gutierrez, A.Mahajan, Y. Shachmurove, M. Shahrokhi, Glob. Finance J., 18, (2007) 3. L.M. Jacob, R.V. Roem, J. of Policy Modeling, 36, (2014) 4. Global Innovation Index Effective Innovation Policie for Development (Geneva: WIPO, 2015) pdf/gii-full-report-2015-v6.pdf Global R&D Funding Forecat (Advantage Buine Media, 2014) _forecat.pdf 6. Charge for the ue of intellectual property, payment (The World Bank Group, 2015) countrie 4

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