IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/113792.html
   My bibliography  Save this paper

Impact of formal and informal institutional constraints on innovation: firm-level evidence from Tunisia

Author

Listed:
  • Sdiri, Hanen

Abstract

Using data from the 2020 World Bank Enterprise Survey in Tunisia, we analyze the joint impact of formal and informal institutional constraints on the types of firms’ innovation. Moreover, we were interested in estimating the effect of the interaction between the two institutional constraints on the types of innovation. The main results of the econometric analysis show that the government system constraints have a positive and statistically significant effect on the likelihood of being an imitator. Furthermore, we show that the legal system constraints have a negative effect on the likelihood of being an innovator, but a positive effect on the probability of being an innovation pretender. We find a significant negative direct effect of commercial bribery on firm innovation. Moreover, the results show that the positive (negative) effect of the constraints from the government system (of the constraints from the legal system) on the probability of innovation will be alleviated by commercial bribery.

Suggested Citation

  • Sdiri, Hanen, 2022. "Impact of formal and informal institutional constraints on innovation: firm-level evidence from Tunisia," MPRA Paper 113792, University Library of Munich, Germany, revised 2022.
    • Handle: RePEc:pra:mprapa:113792
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/113792/1/MPRA_paper_113792.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Edinaldo Tebaldi & Bruce Elmslie, 2013. "Does institutional quality impact innovation? Evidence from cross-country patent grant data," Applied Economics, Taylor & Francis Journals, vol. 45(7), pages 887-900, March.
    2. Jonathan Doh & Suzana Rodrigues & Ayse Saka-Helmhout & Mona Makhija, 2017. "International business responses to institutional voids," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(3), pages 293-307, April.
    3. Nguyen, Ngoc Anh & Doan, Quang Hung & Nguyen, Ngoc Minh & Tran-Nam, Binh, 2016. "The impact of petty corruption on firm innovation in Vietnam," MPRA Paper 71902, University Library of Munich, Germany.
    4. Elena Cefis & Orietta Marsili, 2011. "Born to flip. Exit decisions of entrepreneurial firms in high-tech and low-tech industries," Journal of Evolutionary Economics, Springer, vol. 21(3), pages 473-498, August.
    5. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    6. Hanen Sdiri & Mohamed Ayadi, 2022. "Does Innovation Foster or Mitigate the Corruption Obstacle? Firm-Level Evidence from Tunisia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(1), pages 367-386, March.
    7. Micheline Goedhuys & Pierre Mohnen & Tamer Taha, 2016. "Corruption, innovation and firm growth: firm-level evidence from Egypt and Tunisia," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(3), pages 299-322, December.
    8. Misraku Molla Ayalew & Zhang Xianzhi, 2019. "The effect of financial constraints on innovation in developing countries," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 28(3), pages 273-308, October.
    9. G Cameron, 1996. "Innovation and Economic Growth," CEP Discussion Papers dp0277, Centre for Economic Performance, LSE.
    10. Sharma, Chandan & Mitra, Arup, 2015. "Corruption, governance and firm performance: Evidence from Indian enterprises," Journal of Policy Modeling, Elsevier, vol. 37(5), pages 835-851.
    11. Paul M. Romer, 1994. "The Origins of Endogenous Growth," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 3-22, Winter.
    12. Bach Nguyen & Nguyen Phuc Canh, 2021. "Formal and informal financing decisions of small businesses," Small Business Economics, Springer, vol. 57(3), pages 1545-1567, October.
    13. repec:cup:jfinqa:v:46:y:2011:i:06:p:1545-1580_00 is not listed on IDEAS
    14. Daniel Lederman, 2010. "An international multilevel analysis of product innovation," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 41(4), pages 606-619, May.
    15. Horak, Sven & Restel, Katja, 2016. "A Dynamic Typology of Informal Institutions: Learning from the Case of Guanxi," Management and Organization Review, Cambridge University Press, vol. 12(3), pages 525-546, September.
    16. Francesco Crespi, 2004. "Notes on the Determinants of Innovation: A Multi-Perspective Analysis," Working Papers 2004.42, Fondazione Eni Enrico Mattei.
    17. Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2012. "Financing of firms in developing countries : lessons from research," Policy Research Working Paper Series 6036, The World Bank.
    18. Keld Laursen & Francesca Masciarelli & Andrea Prencipe, 2012. "Regions Matter: How Localized Social Capital Affects Innovation and External Knowledge Acquisition," Organization Science, INFORMS, vol. 23(1), pages 177-193, February.
    19. Varsakelis, Nikos C., 2006. "Education, political institutions and innovative activity: A cross-country empirical investigation," Research Policy, Elsevier, vol. 35(7), pages 1083-1090, September.
    20. Ayyagari, Meghana & Demirgüç-Kunt, Asli & Maksimovic, Vojislav, 2011. "Firm Innovation in Emerging Markets: The Role of Finance, Governance, and Competition," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 46(6), pages 1545-1580, December.
    21. Zhang, Dongyang & Zheng, Wenping & Ning, Lutao, 2018. "Does innovation facilitate firm survival? Evidence from Chinese high-tech firms," Economic Modelling, Elsevier, vol. 75(C), pages 458-468.
    22. Yanmei Zhu & Xinhua Wittmann & Mike Peng, 2012. "Institution-based barriers to innovation in SMEs in China," Asia Pacific Journal of Management, Springer, vol. 29(4), pages 1131-1142, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. SDIRI, Hanen, 2022. "The Influence of Environmental Commitment and Innovation on Export Intensity: Firm-Level Evidence from Tunisia," MPRA Paper 113793, University Library of Munich, Germany.
    2. Barasa, Laura & Knoben, Joris & Vermeulen, Patrick & Kimuyu, Peter & Kinyanjui, Bethuel, 2017. "Institutions, resources and innovation in East Africa: A firm level approach," Research Policy, Elsevier, vol. 46(1), pages 280-291.
    3. Arshed, Noman & Hanif, Nadia & Aziz, Osama & Croteau, Martin, 2022. "Exploring the potential of institutional quality in determining technological innovation," Technology in Society, Elsevier, vol. 68(C).
    4. Rodríguez-Pose, Andrés & Zhang, Min, 2020. "The cost of weak institutions for innovation in China," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    5. Lurdes Martins & Jorge Cerdeira & Aurora A.C. Teixeira, 2020. "Does corruption boost or harm firms’ performance in developing and emerging economies? A firm‐level study," The World Economy, Wiley Blackwell, vol. 43(8), pages 2119-2152, August.
    6. Hanen Sdiri & Mohamed Ayadi, 2022. "Does Innovation Foster or Mitigate the Corruption Obstacle? Firm-Level Evidence from Tunisia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(1), pages 367-386, March.
    7. Barasa, L. & Kimuyu, P. & Vermeulen, P.A.M. & Knoben, J. & Kinyanjui, B., 2014. "Institutions, Resources and Innovation in Developng Countries : A Firm Level Approach," Other publications TiSEM 4150bffe-8365-4b51-a7e9-d, Tilburg University, School of Economics and Management.
    8. Dincer, Oguzhan, 2019. "Does corruption slow down innovation? Evidence from a cointegrated panel of U.S. states," European Journal of Political Economy, Elsevier, vol. 56(C), pages 1-10.
    9. Kuzman Tanja & Bellos Sotirios K. & Đulić Katarina, 2018. "Determinants of Innovation-based Sustainability in Transition and Developing Economies," Economic Themes, Sciendo, vol. 56(3), pages 413-438, September.
    10. Andrés Rodríguez-Pose & Marco Di Cataldo, 2015. "Quality of government and innovative performance in the regions of Europe," Journal of Economic Geography, Oxford University Press, vol. 15(4), pages 673-706.
    11. Dokas, Ioannis & Panagiotidis, Minas & Papadamou, Stephanos & Spyromitros, Eleftherios, 2023. "Does innovation affect the impact of corruption on economic growth? International evidence," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 1030-1054.
    12. Nirosha Wellalage & Sujani Thrikawala, 2021. "Does bribery sand or grease the wheels of firm level innovation: evidence from Latin American countries," Journal of Evolutionary Economics, Springer, vol. 31(3), pages 891-929, July.
    13. Hung Quang Doan & Nam Hoang Vu & Binh Tran-Nam & Ngoc-Anh Nguyen, 2022. "Effects of tax administration corruption on innovation inputs and outputs: evidence from small and medium sized enterprises in Vietnam," Empirical Economics, Springer, vol. 62(4), pages 1773-1800, April.
    14. Dongying Du & Xiaojian Tang & Huaiming Wang & Joseph H. Zhang & Stephanie Tsui & Dongjie Lin, 2022. "CEO organizational identification and corporate innovation investment," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(3), pages 4185-4217, September.
    15. Alvarado, Rafael & Murshed, Muntasir & Cifuentes-Faura, Javier & Işık, Cem & Razib Hossain, Mohammad & Tillaguango, Brayan, 2023. "Nexuses between rent of natural resources, economic complexity, and technological innovation: The roles of GDP, human capital and civil liberties," Resources Policy, Elsevier, vol. 85(PA).
    16. Chei Bukari & Emm anuel Atta Anaman, 2021. "Corruption and firm innovation: a grease or sand in the wheels of commerce? Evidence from lower-middle and upper-middle income economies," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 11(2), pages 267-302, June.
    17. Chidlow, Agnieszka & Wang, Jue & Liu, Xiaohui & Wei, Yingqi, 2021. "A co-evolution perspective of EMNE internationalization and institutions: An integrative framework of 5Cs," International Business Review, Elsevier, vol. 30(4).
    18. Finocchiaro Castro ,Massimo & Guccio, Calogero, 2023. "New wine in old bottle: Exploring the Corruption-inefficiency nexus using endogenous stochastic frontier approach," EconStor Preprints 275730, ZBW - Leibniz Information Centre for Economics.
    19. Ayse Saka-Helmhout & Maryse M. H. Chappin & Suzana B. Rodrigues, 2022. "Corporate Social Innovation in Developing Countries," Journal of Business Ethics, Springer, vol. 181(3), pages 589-605, December.
    20. Stephen Knowles & P. Dorian Owen, 1997. "Education and Health in an Effective‐Labour Empirical Growth Model," The Economic Record, The Economic Society of Australia, vol. 73(223), pages 314-328, December.

    More about this item

    Keywords

    Innovation. Formal Institutions. Informal Institutions. Tunisian firms;

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:113792. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.