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What explains the evolution of productivity and competitiveness? The innovation link

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Author Info

  • Jaumandreu, Jordi

    ()
    (IESE Business School)

Abstract

This paper addresses the recent evolution of productivity and competitiveness in Catalonia and their links with the innovation activity of firms. Firstly, it summarizes the evolution of productivity, competitiveness, firms' strategies and the state of innovation. A slowdown in productivity growth and increasing revealed difficulties in some world markets are real, and the weakness of innovation may be a reason. The paper then quantifies some of the links between innovation, productivity and competitiveness. Innovation has a positive impact on productivity and competitiveness. First of all, innovation expenditures induce cost advantages and these cost advantages are a significant explanation for firms' exports. Furthermore, product innovation helps exports, too. Moreover, R&D activities in Catalonia benefit from high spillovers, and productivity impact is even higher when firms develop R&D activities outside as well. Despite all this, the current level of innovation expenditure is comparatively low and shows signs of lack of dynamism. Firms need to switch from the current equilibrium to the requirements of the coming years.

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Bibliographic Info

Paper provided by IESE Business School in its series IESE Research Papers with number D/804.

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Length: 40 pages
Date of creation: 17 Jul 2009
Date of revision:
Handle: RePEc:ebg:iesewp:d-0804

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Postal: IESE Business School, Av Pearson 21, 08034 Barcelona, SPAIN
Web page: http://www.iese.edu/
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Related research

Keywords: Labor productivity; Competitiveness; innovation; cost;

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References

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  1. Rachel Griffith & Rupert Harrison & John Van Reenen, 2004. "How special is the special relationship? Using the impact of US R&D spillovers on UK firms as a test of technology sourcing," IFS Working Papers W04/32, Institute for Fiscal Studies.
  2. Rupert Harrison & Jordi Jaumandreu & Jacques Mairesse & Bettina Peters, 2008. "Does Innovation Stimulate Employment? A Firm-Level Analysis Using Comparable Micro-Data from Four European Countries," NBER Working Papers 14216, National Bureau of Economic Research, Inc.
  3. Isabel Busom, 2000. "An Empirical Evaluation of The Effects of R&D Subsidies," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 9(2), pages 111-148.
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Cited by:
  1. Ghemawat, Pankaj & Llano, Carlos & Requena, Francisco, 2010. "Competitiveness and interregional as well as international trade: The case of Catalonia," International Journal of Industrial Organization, Elsevier, vol. 28(4), pages 415-422, July.
  2. Esther Goya & Esther Vayá & Jordi Suriñach, 2011. "Productivity and innovation spillovers: Micro evidence from Spain," IREA Working Papers 201126, University of Barcelona, Research Institute of Applied Economics, revised Dec 2011.

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