The paper deals with the effects of publicly funded research at universities, polytechnics and federal and state financed research labs on industrial innovations in Germany. In order to understand the current state of public research institutions in Germany, chapter two shortly describes its historical context, characterized by the traditional Central European view of natural science as a value in itself, the inertia of public institutions and tensions between federal and state responsibility for science policy.In the third chapter we will deal with the following question: Are innovating companies able to identify the contribution of public research to industrial innovations and trace the source of these innovations? In a postal questionnaire, 2,300 companies were asked whether they had introduced innovations between 1993 and 1995 that would not have been developed without public research. Less than one tenth of product or process innovating firms said that they had introduced public-research-based innovations. The public-research-based products account for approximately 5% of all sales with new products. Even more important are the differences in the effectiveness of technology transfer between different types of public research institutions. Universities are cited by firms with publicly supported innovations as the most important source, although publicly financed labs get almost as much citations. When firms were asked to name the most important public institutes, they most frequently cited the institutes of the Fraunhofer-Society. It seems obvious that their technology transfer is spurred by the higher share of research funds from industry. Big science labs are almost invisible, suggesting that their technology transfer to industrial firms still lacks effectiveness.One of the basic findings is that a considerable share of companies can indeed identify product and process innovations which they would not have developed in the absence of recent research of public institutions. The results are similar to the findings of Mansfield (1991) for the U.S. On the side of the firms, we find that German firms with R&D activities are more likely to profit from public research. Private and public research thus complement each other. Proximity may not have the same importance in Germany than in other countries, especially the U.S. The thesis that proximity is important especially for high-tech or R&D-intensive industries is clearly rejected in the case of Germany. Although firms tend to cite research institutions that are located in their local area, firms which are closer to the public research have no higher propensity to receive public research spillover. Contrary to the widely held opinion that proximity to public research institution does promote collaboration between firms and public research institutions and increases the amount of received knowledge spillovers. Firms with a high R&D intensity cite remote public research institutes more frequently than less R&D intensive firms, suggesting that in Germany high-tech d...

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Editorial DirectorJan Smets, Member of the Board of Directors of the National Bank of Belgium Statement of purpose:The purpose of these working papers is to promote the circulation of research results (Research Series) and analytical studies (Documents Series) made within the National Bank of Belgium or presented by external economists in seminars, conferences and conventions organised by the Bank. The aim is therefore to provide a platform for discussion. The opinions expressed are strictly those of the authors and do not necessarily reflect the views of the National Bank of Belgium. AbstractThis study investigates the pricing behaviour of firms in the euro area on the basis of surveys conducted by nine Eurosystem national central banks. Overall, more than 11,000 firms participated in the survey. The results are very robust across countries. Firms operate in monopolistically competitive markets, where prices are mostly set following mark-up rules and where price discrimination is a common practice. Our evidence suggests that both time-and state-dependent pricing strategies are applied by firms in the euro area: around one-third of the companies follow mainly time-dependent pricing rules while two-thirds use pricing rules with some element of statedependence. Although the majority of firms take into account a wide range of information, including past and expected economic developments, about one-third adopts a purely backward-looking behaviour. The pattern of results lends support to the recent wave of estimations of hybrid versions of the New Keynesian Phillips Curve. Price stickiness arises both at the stage when firms review their prices and again when they actually change prices. The most relevant factors underlying price rigidity are customer relationships -as expressed in the theories about explicit and implicit contracts -and thus, are mainly found at the price changing (second) stage of the price adjustment process. Finally, we provide evidence that firms adjust prices asymmetrically in response to shocks, depending on the direction of the adjustment and the source of the shock: while cost shocks have a greater impact when prices have to be raised than when they have to be reduced, reductions in demand are more likely to induce a price change than increases in demand.

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. In 2005 all ECB publications will feature a motif taken from the €50 banknote. Terms of use: Documents in WO R K I N G PA P E R S E R I E S N O. 5 6 3 / D E C E M B E R 2 0 0 5 C O N T E N T S Abstract 4Non-technical summary 5

This paper summarizes the microevidence on the setting of producer prices in the euro area. The main findings are: (i) 21% of producer prices are adjusted each month, (ii) producer prices are changed more frequently and by smaller amounts than consumer prices (even after controlling for product characteristics), (iii) price decreases are relatively frequent, (iv) inflation correlates positively with the difference between the frequency of price increases and decreases, and (v) there is substantial variation in price flexibility across sectors, which can be explained in part by differences in the cost structure, the degree of competition, and the level of sectoral inflation.

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Editorial DirectorJan Smets, Member of the Board of Directors of the National Bank of Belgium Statement of purposeThe purpose of these working papers is to promote the circulation of research results (Research Series) and analytical studies (Documents Series) made within the National Bank of Belgium or presented by external economists in seminars, conferences and conventions organised by the Bank. The aim is therefore to provide a platform for discussion. The opinions expressed are strictly those of the authors and do not necessarily reflect the views of the National Bank of Belgium. OrdersFor orders and information on subscriptions and reductions: National Bank of Belgium, Documentation -Publications service, boulevard de Berlaimont 14, 1000 Brussels there is no evidence of downward nominal rigidity: price changes are for about 45% decreases and 55% increases. Fifth, price changes are sizeable compared to the inflation rate. The paper also examines the factors driving producer price changes. It finds that costs structure, competition, seasonality, inflation and attractive pricing all play a role in driving producer price changes. In addition producer prices tend to be more flexible than consumer prices.JEL-code : E31, D40, C25.