Assistant Professor of Economics Dong Cheng has recently published three papers in peer-reviewed journals, offering new insights into automobile diffusion, innovation strategy, and the financing of technological change.
The first paper, 鈥,鈥 coauthored with Mario J. Crucini (Purdue University), Hyunseung Oh (Federal Reserve Board), and Hakan Yilmazkuday (Florida International University), and published in the Journal of International Economics, assembles newly curated historical data to explain the striking gap in automobile adoption between the United States and the rest of the world by 1929. The study documents a set of sizable price wedges鈥攆rom export markups and tariffs to distribution costs and gasoline-tax-driven user costs鈥攁nd demonstrates, through an intuitive adoption framework, that removing these distortions alongside income differences accounts for more than 80% of the global adoption gap.
Cheng鈥檚 second paper, 鈥,鈥 coauthored with Michael A. Klein (RPI) and Fuat 艦ener (Union College) and forthcoming in Journal of Economics & Management Strategy, uses rich microdata from China鈥檚 Patent Survey to study how firms protect and extract value from innovation. The authors show that although patents remain the dominant appropriation strategy, firms often rely on them for strategic purposes鈥攕uch as securing external financing or contracting with third-party producers鈥攚hile using secrecy and first-mover advantage to guard against imitation from competitors. It also finds that firms undertaking the most costly R&D projects exhibit a relative preference for secrecy.
The third publication, 鈥,鈥 in Finance Research Letters, examines how firms鈥 financing structures shape their technology acquisition choices. Cheng finds that bank loans and government funding support collaborative or lower-risk strategies, whereas internal cash facilitates more innovation-intensive approaches such as independent and joint R&D. Greater diversity in financing sources is associated with broader strategic scope, though its importance diminishes for patent-rich firms that rely less on external acquisition.
The first paper, 鈥,鈥 coauthored with Mario J. Crucini (Purdue University), Hyunseung Oh (Federal Reserve Board), and Hakan Yilmazkuday (Florida International University), and published in the Journal of International Economics, assembles newly curated historical data to explain the striking gap in automobile adoption between the United States and the rest of the world by 1929. The study documents a set of sizable price wedges鈥攆rom export markups and tariffs to distribution costs and gasoline-tax-driven user costs鈥攁nd demonstrates, through an intuitive adoption framework, that removing these distortions alongside income differences accounts for more than 80% of the global adoption gap.
Cheng鈥檚 second paper, 鈥,鈥 coauthored with Michael A. Klein (RPI) and Fuat 艦ener (Union College) and forthcoming in Journal of Economics & Management Strategy, uses rich microdata from China鈥檚 Patent Survey to study how firms protect and extract value from innovation. The authors show that although patents remain the dominant appropriation strategy, firms often rely on them for strategic purposes鈥攕uch as securing external financing or contracting with third-party producers鈥攚hile using secrecy and first-mover advantage to guard against imitation from competitors. It also finds that firms undertaking the most costly R&D projects exhibit a relative preference for secrecy.
The third publication, 鈥,鈥 in Finance Research Letters, examines how firms鈥 financing structures shape their technology acquisition choices. Cheng finds that bank loans and government funding support collaborative or lower-risk strategies, whereas internal cash facilitates more innovation-intensive approaches such as independent and joint R&D. Greater diversity in financing sources is associated with broader strategic scope, though its importance diminishes for patent-rich firms that rely less on external acquisition.