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Entropy 2018, 20(11), 887; https://doi.org/10.3390/e20110887

A Technology-Based Classification of Firms: Can We Learn Something Looking Beyond Industry Classifications?

European Commission, Join Research Centre (JRC), 41092 Seville, Spain
The views expressed are purely those of the authors and may not in any circumstances be regarded as stating an official position of the European Commission.
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Received: 2 August 2018 / Revised: 30 October 2018 / Accepted: 9 November 2018 / Published: 18 November 2018
(This article belongs to the Special Issue Economic Fitness and Complexity)
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Abstract

In this work we use clustering techniques to identify groups of firms competing in similar technological markets. Our clustering properly highlights technological similarities grouping together firms normally classified in different industrial sectors. Technological development leads to a continuous changing structure of industries and firms. For this reason, we propose a data driven approach to classify firms together allowing for fast adaptation of the classification to the changing technological landscape. In this respect we differentiate from previous taxonomic exercises of industries and innovation which are based on more general common features. In our empirical application, we use patent data as a proxy for the firms’ capabilities of developing new solutions in different technological fields. On this basis, we extract what we define a Technologically Driven Classification (TDC). In order to validate the result of our exercise we use information theory to look at the amount of information explained by our clustering and the amount of information shared with an industrial classification. All-in-all, our approach provides a good grouping of firms on the basis of their technological capabilities and represents an attractive option to compare firms in the technological space and better characterise competition in technological markets. View Full-Text
Keywords: clustering; industrial classification; innovation studies; patents studies; industrial economics; scoreboard clustering; industrial classification; innovation studies; patents studies; industrial economics; scoreboard
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Gkotsis, P.; Pugliese, E.; Vezzani, A. A Technology-Based Classification of Firms: Can We Learn Something Looking Beyond Industry Classifications? Entropy 2018, 20, 887.

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