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Does firm innovation lead to high growth? Evidence from Ecuadorian firms

Author

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  • Diego F. Grijalva
  • Valeria Ayala
  • Paúl A. Ponce
  • Yelitza Pontón

Abstract

We analyze the determinants of: i) employment and sales growth, and ii) the likelihood of becoming a high-growth firm (HGF) among Ecuadorian firms for the period 2011-2014. We apply a two-stage econometric model that controls for selection bias in the choice to innovate in regards to the two rounds of the Ecuadorian National Innovation Activities Survey. We find that younger firms and firms that spend more on R&D activities per employee have significantly higher levels of employment growth and are significantly more like to become employment HGFs.

Suggested Citation

  • Diego F. Grijalva & Valeria Ayala & Paúl A. Ponce & Yelitza Pontón, 2018. "Does firm innovation lead to high growth? Evidence from Ecuadorian firms," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, vol. 37(75), pages 697-726, May.
    • Handle: RePEc:col:000093:017125
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    More about this item

    Keywords

    Firm growth; high-growth firms; job creation; entrepreneurship; innovation.;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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