The role of government in forming and coordinating R&D consortia has often been cited in studies of the economic success of latecomer countries such as Korea and Japan. Most previous studies documented the government's efforts to provide funding. In our research about the government's role in determining the quality of innovation, we develop a computational model based on genetic algorithms. The two main aspects of government involvement explored in this study are 1) the timing of evaluation of participating firms in a consortium, and 2) the form that these consortia take. In terms of the timing of evaluation, we find that continuous evaluation is consistently superior to early evaluation. In addition, the effect of the form of the consortium depends on the timing of evaluation. An inverse pyramid arrangement, which emphasizes variation at the beginning of the innovation process, outperforms a pyramid-form arrangement only when evaluation is continuous. We identify the tension and reconciliation between diversity and selection as the force underlying the results of this study. We discuss these findings and their implications for how governments should balance diversity and selection when designing innovation systems.
Bibliographical noteFunding Information:
This work was supported by the 2014 Research Fellowship Fund of the Sangnam Institute of Management , Yonsei University. Jae-Suk Yang is grateful to the Sanford C. Bernstein & Co. Center for Leadership and Ethics for financial support. The authors also are grateful to Dr. Jang-Yeon Kwon, Dr. Seung-Moon Lee, and Dr. Tonghun Lee. Ji-hyun Kim is an assistant professor at Yonsei University, Seoul, Korea. He received his PhD in business from New York University Stern School of Business. He recently published in Strategic Management Journal and Academy of Management Best Paper Proceedings . His research interests include organizational learning, organizational design and search. Sung Joo Bae received his doctorate at the MIT Sloan School of Management. As a faculty member of the School of Business, Yonsei University, he conducts research in the field of technology management. He recently published papers in Journal of Consumer Psychology and International Journal of Production Economics on the topics such as product evaluation and R&D outsourcing. Jae-Suk Yang is a senior researcher at the Sanford C. Bernstein & Co. Center for Leadership and Ethics at Columbia Business School. He holds a PhD in applied physics from KAIST (Korea Advanced Institute of Science and Technology). He has published in international journals including PNAS ( Proceedings of the National Academy of Sciences of the United States of America ), PLoS ONE , and Physical Review . His research interests are with diffusion by social contagion, organizational learning, and innovation.
All Science Journal Classification (ASJC) codes
- Business and International Management
- Applied Psychology
- Management of Technology and Innovation