Economics Research Seminar | Weatherhead School at Case Western Reserve University

Economics Research Seminar

Data Analytics Supports Decentralized Innovation

Modern analytics technology can accelerate the innovation process by increasing the rate at which existing knowledge can be identified, accessed, combined and deployed to address new problem domains. However, like prior advances in information technology, the ability of firms to exploit these opportunities depends on a variety of complementary human capital and organizational capabilities. We focus on how the benefits of analytics to innovation may differ depending on how firms organize their innovative activities. Our analysis draws on prior work that has measured firm analytics capability using detailed employee-level data and matches these data to metrics on intra-firm inventor networks that reveal whether a firm has a centralized or decentralized innovation structure. In a panel of large firms from the years 1988 to 2013, we find that firms with a decentralized innovation structure have a greater demand for analytics skills and receive greater productivity benefits from their analytics capabilities, consistent with a complementarity between analytics and decentralized innovation. Furthermore, we find the complementarity is strongest for innovation involving the recombination of existing technologies. Our results suggest that organizational structures, such as decentralization, have a substantial influence on the ability of firms to capture the benefits of analytics for innovation, primarily because analytics can facilitate the linking of distant technologies between different decentralized groups.

Please join the Economics Department for a research seminar.  This event is open to all Case Western Reserve University faculty, Ph.D. students, economic majors and minors, and those interested in economics research.

Contact Information:

Teresa Kabat 

Friday, Nov. 9, 2018 from 12:30 p.m. to 2 p.m.
Peter B. Lewis Building, Room 401
11119 Bellflower Road
Cleveland, OH 44106-7235
United States
Speaker(s): Lynn Wu, Univ of Pennsylvania, Wharton
Sponsored by: Economics Department
Data Analytics


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