This study analyses how public R&D financing impacts the labour demand of companies. To our knowledge, no previous studies have distinguished the impact on the firm's global and domestic employment. Our company-level panel data covers a period from 1997 to 2002. The statistical method employed in the study takes into account the possibility that receiving public support may be an endogenous factor. Our results suggest that public R&D financing increases both group-level and domestic R&D employment. We also analysed the impact of public R&D funding on other than R&D employment. According to our results, public funding does not have an effect on other than R&D employment. However, it is possible that these impacts exist in the longer run.
We analyse the trade routes between the UK and EU countries. Our results show that the relative importance of the UK as a trading partner in the EU has slightly decreased. We further decompose the total value added into components that quantify the value added that is generated through direct trade with the UK and the indirect trade that is channelled through third countries. Close to one third of the total value added is generated through indirect trade and two thirds through direct trade. Furthermore, 18 per cent of EU countries' value-added trade to the UK passes through the UK onto other countries.
In this study, we analyze the trade linkages between the United Kingdom (UK), Finland, and the European Union (EU). We calculate the value-added content of trade through complex global value chains (GVCs), which may involve numerous production stages and third countries. Our results show that the importance of the UK as a trading partner for Finland has decreased during the last 15 years, and the tendency has been stronger than that between the UK and other EU countries, on average. We compare the importance of the UK to that of other countries by extracting the total amount of the Finnish value added that is generated in the value chains involving individual countries. Through this comparison, we find that the UK ranks as the sixth most important country. We further decompose the total value added into components that quantify the value added that is generated through direct trade with the UK and the indirect trade that is channeled through third countries. We find that roughly one third of the total value added is generated through indirect trade and two thirds through direct trade. Our analysis also suggests that one fifth of both the Finnish and EU value-added trade to the UK passes through the UK to other countries. The main destination countries are the United States (US), Germany, and France.
We analyze the value-added impacts of rising (United States) US protectionism on Finland and other European Union (EU) member states. The president of the US has proposed tariff increases, particularly on imports from Mexico and China to the US, while the threat of protectionism also involves more direct tariffs against EU exports to the US. We apply a measurement framework for the decomposition of value-added trade to the US grounded on hypothetical extraction, a mathematical technique based on an input-output representation of the global economy. Our results show that trade to the US continues to be an important source of the value added for Finland as well as the majority of the EU, even during the temporary slowdown of trade during the Great Recession. For many countries, trade to the US represents over 10% of the value added from exports to all countries. We find that a large majority of the value added for both Finland and the EU goes directly as intermediate or final goods and services to the US. Much less value added is generated via other countries through either their intermediate or direct final exports to the US. The other most important trade channel is through Germany. We investigate the effect of the trade barriers in several counterfactual scenarios. Using standard export elasticity estimates, we find that the value added generated by Finland and other EU countries through Mexico and China to the US would decline drastically if the US launched tariff rises on imports from Mexico and China to the US. The impacts would be significantly worse if the US raised tariff rates on direct imports from EU countries.
This report summarizes 39 detailed ETLA case studies of global value chains (GVCs). The findings suggest that the value added in global value chains is less tied to their tangible aspects than what conventional wisdom suggests. Intangible aspects of GVCs tend to be more important, but their poor measurement in available statistics misguides. With the raise of GVCs, interests of governments and multinational enterprises operating within national borders are increasingly at odds, e.g., when it comes to transfer pricing practices. The evidence from Finland shows that misinterpreted (or ignored) transfer pricing rules have significant impacts on GDP and other macroeconomic measures. Since multinational enterprises, and GVCs they operate, have grown to dominate international trade, the focus of national policymakers should shift from companies and industries to tasks and functions that are conducted within national borders.
The report looks at Nokia in the Finnish innovation system. Nokia serves both as a user and as a producer in the innovation system. Nokia has had a remarkably positive impact on Finland's very high ratio of R&D expenditure to GDP. Moreover, at least partly due to Nokia, Finnish exports of high-tech products are notably greater than high-tech imports. Nokia co-operates with companies, universities and research institutes. Our interviews suggest that, due to co-operation, knowledge has flowed from one party to another. In addition to R&D co-operation, recruitment from universities to companies and vice versa has served as another important knowledge transfer channel. Although R&D co-operation has functioned well in most cases, in some cases problems have emerged. According to some of our interviewees, the allocation of intellectual property rights (IPR) has been troublesome. Another concern was related to the retaining of universities' high knowledge level in the future. – Nokia ; innovation system ; Finland ; R&D ; research and development ; education ; Knowledge ; technology ; Tutkimuksessa tarkastellaan Nokiaa osana Suomen innovaatiojärjestelmää. Nokia toimii sekä innovaatioresurssien käyttäjänä että uusien resurssien tuottajana. Nokialla on suuri vaikutus siihen, että Suomen tutkimus- ja tuotekehityspanostukset suhteessa BKT:hen on maailman kärkiluokkaa. Yhtiö on myös keskeisesti vaikuttanut siihen, että Suomen korkean teknologian tuotteiden ulkomaankauppa on tuntuvasti ylijäämäinen. Nokia tekee yhteistyötä niin yritysten kuin korkeakoulujen ja tutkimuslaitostenkin kanssa. Tämän tutkimuksen aikana tehdyt haastattelut viittaavat siihen, että yhteistyön seurauksena tietotaitoa on levinnyt eri osapuolille. Tutkimusyhteistyön lisäksi rekrytointi korkeakouluista yrityksiin ja joissain tapauksissa yrityksistä korkeakouluihin on toiminut tärkeänä osaamisen siirtokanavana. Vaikka tutkimus ja tuotekehitysyhteistyö on toiminut pääasiassa hyvin, joissain tapauksissa siitä on myös aiheutunut ongelmia. Osa haastatelluista koki erityisen ongelmalliseksi aineettomien oikeuksien (IPR) jakautumisen. Toinen huolenaihe koski korkeakoulujen osaamistason säilyttämistä tulevaisuudessa. – Nokia ; innovaatiojärjestelmä ; Suomi ; T&K ; tutkimus- ja tuotekehitys ; koulutus ; Osaaminen ; teknologia
