R and D Spillovers Across the Supply Chain: Evidence from the Indian Automobile Industry

This study attempts to capture the impact of vertical and horizontal R and D spillovers across the supply chain. Empirical studies have captured vertical spillovers while finding the role of horizontal spillovers in R and D to be negligible, as the pool of accessible knowledge is the same for a cross section of firms within an industry. However, from a supply chain perspective, though firms may be suppliers to an industry, they belong to different industries themselves; and different tiers of the supply chain. The automobile industry is a good case in point: though auto component firms supply to the automobile sector, they come under diverse industrial classification schemes like rubber, electronics and engineering. The present study attempts to measure the horizontal spillovers within Indian Indian auto components Industry as well as spillovers coming vertically from the original equipment manufacturers (OEM) from a flow and a stock perspective.