Innovating firms can choose to engage in either internal or external R&D, or in both. In the current study, we shall examine internal and external R&D separately to determine empirically the market structure characteristics explaining the external R&D share and the differences in market structure determinants between internal and external R&D. Our results indicate that a government policy that aims at stimulating technological progress by offering external research facilities is particularly interesting for smaller, capital-intensive firms operating in less concentrated markets.

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De Economist
Erasmus School of Economics

den Hertog, R. G. J., & Thurik, R. (1993). Determinants of internal and external R&D: some Dutch evidence. De Economist, 279–289. Retrieved from