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Abstract

This paper studies empirical relationship between competition and innovation in Indonesia using micro data BPS. Lack of innovation data has requires this paper to use R&D expenditure as innovation in year of data avaibility. Competition is estimated by computing profit elasticity, based on idea of efficiency. Inverted-U shape tested with technology spread within industries at which effect of competition and innovation can turn from positive to negative. Empirical evidence shows that relationship between competition and innovation is inverted-U with very low optimal point. This means that very few industries can increase innovation and almost all industries will reduce innovation as competition increases.

Bahasa Abstract

Penelitian ini menganalisis hubungan empiris antara kompetisi dan inovasi di Indonesia dengan menggunakan data perusahaan BPS. Keterbatasan data inovasi mengharuskan penggunaan R&D expenditure sebagai inovasi pada tahun tersedianya data. Kompetisi diestimasi dengan menggunakan profit elasticity berdasarkan gagasan efisiensi. Bentuk inverted-U diuji dengan technology spread pada industri dengan efek dari kompetisi dan inovasi dapat berubah dari positif menjadi negatif. Bukti empiris menunjukkan hubungan antara kompetisi dan inovasi merupakan inverted-U dengan titik optimal yang sangat rendah. Ini berarti sangat sedikit industri yang dapat meningkatkan inovasi dan hampir semua industri akan mengurangi inovasi ketika kompetisi meningkat.

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