Innovation and appropriation mechanisms: Evidence from Argentine microdata

This paper analyzes the use of mechanisms for the appropriation of innovation profits in Argentine industry, using data on around 200 firms belonging to five industrial sectors. It includes a theoretical discussion of the concept of appropriability and, contrary to what is widely accepted in innovation literature about the influence of appropriability on innovation efforts, argues that the chosen appropriation strategy is determined by the characteristics of the innovation process (innovative effort, type of results obtained, accumulated capabilities, cooperation, and public support) and structural characteristics of the firm (technological intensity, firm size, and age). Probit models are specified and estimated in order to identify the main determinants of the use of each mechanism. The results show that the characteristics of the innovation process indeed influence the choice of appropriation strategy, and the use of each mechanism responds to different aspects of the innovation process. The descriptive statistics show that the use of strategic mechanisms is greater than the use of legal ones, indicating the existence of different sectoral appropriation patterns.

► The paper argues that innovation is a determinant of appropriation strategy.
► Probit models are estimated to identify the determinants of appropriation mechanisms.
► Use of each mechanism responds to different aspects of innovation process.
► Sectoral patterns of appropriation are associated with sectoral patterns of innovation.