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Service Innovation, Embeddedness and Business Performance: Evidence from Northern Ireland

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  • James Love
  • Stephen Roper
  • Nola Hewitt-Dundas

Abstract

Love J. H., Roper S. and Hewitt-Dundas N. Service innovation, embeddedness and business performance: evidence from Northern Ireland, Regional Studies. This paper explores the factors that determine innovation by service firms, and in particular the contribution of intra- and extra-regional connectivity. Subsequently, it is examined how service firms' innovation activity relates to productivity and export behaviour. The empirical analysis is based on matched data from the 2005 UK Innovation Survey - the UK component of the 4th Community Innovation Survey (CIS) - and the Annual Business Inquiry for Northern Ireland. Evidence is found of negative intra-regional embeddedness effects, but there is a positive contribution to innovation from extra-regional connectivity, particularly links to customers. Relationships between innovation, exporting, and productivity prove complex, but suggest that innovation itself is not sufficient to generate productivity improvements. Only when innovation is combined with increased export activity are productivity gains evident. [image omitted] Love J. H., Roper S. et Hewitt-Dundas N. L'innovation des services, l'ancrage et la performance des affaires commerciales: des preuves provenant de l'Irlande du Nord, Regional Studies. On examine les facteurs qui determinent l'innovation par les entreprises de services et en particulier l'apport de la connectivite au sein de et en dehors de la region. Par la suite, on examine comment l'innovation des entreprises de services se rapporte a la productivite et aux exportations. L'analyse empirique est fondee sur des donnees appariees qui proviennent de la Innovation Survey 2005 (enquete sur l'innovation, menee en 2005) - le chapitre de la Fourth CIS propre au R-U - et de la Annual Business Enquiry for Northern Ireland (enquete annuelle sur le commerce en Irlande du Nord). Il s'avere des preuves des effets d'ancrage negatifs sur le plan intraregional, mais il y a un apport positif a l'innovation du a la connectivite en dehors de la region, notamment des liens aux clients. Le rapport entre l'innovation, l'exportation et la productivite s'averent difficiles mais cela laisse supposer que l'innovation elle-meme ne suffit pas pour engendrer des gains de productivite. Ces derniers ne sont evidents qu'au moment ou l'innovation va de pair avec une augmentation des exportations. Innovation Services Amenagement du territoire Productivite Exportation Irlande du Nord Love J. H., Roper S. und Hewitt-Dundas N. Innovation von Dienstleistungen, Einbettung und Geschaftsleistung: Belege aus Nordirland, Regional Studies. Wir untersuchen die fur die Innovationen von Dienstleistungsfirmen ausschlaggebenden Faktoren und insbesondere den Beitrag von intra- und extraregionalen Verknupfungen. Anschliessend betrachten wir die Beziehungen zwischen der Innovationsaktivitat von Dienstleistungsfirmen und deren Produktivitat und Exporttatigkeit. Unsere empirische Analyse basiert auf abgeglichenen Daten der britischen Innovationserhebung von 2005 (der britischen Komponente der vierten Innovationserhebung der Gemeinschaft) und der jahrlichen Unternehmensumfrage fur Nordirland. Wir stellen Anzeichen von negativen Auswirkungen einer intraregionalen Einbettung fest, aber auch einen positiven Beitrag zur Innovation durch extraregionale Verknupfungen, insbesondere im Bereich der Kundenbeziehungen. Die Beziehungen zwischen Innovation, Export und Produktivitat erweisen sich als komplex, lassen aber darauf schliessen, dass Innovation allein nicht zur Verbesserung der Produktivitat ausreicht. Nur wenn Innovation mit einer erhohten Exporttatigkeit einhergeht, sind Produktivitatssteigerungen festzustellen. Innovation Dienstleistungen Regionalentwicklung Produktivitat Export Irland Love J. H., Roper S. y Hewitt-Dundas N. Innovacion de servicios, integracion y desempeno comercial: evidencias de Irlanda del Norte, Regional Studies. Analizamos los factores que determinan la innovacion por parte de empresas de servicios y en concreto la contribucion de la conectividad intra y extrarregional. Posteriormente examinamos la relacion entre la actividad de innovacion de las empresas de servicios y la productividad y el comportamiento de exportacion. Nuestro analisis empirico se basa en datos comparativos del Estudio de Innovacion 2005 del Reino Unido; el componente britanico de la cuarta Encuesta Comunitaria de Innovacion y la Investigacion Comercial Anual de Irlanda del Norte. Hallamos evidencia de efectos negativos de integracion intrarregional pero existe una contribucion positiva a la innovacion por parte de la conectividad extrarregional, especialmente de los enlaces a los clientes. Las relaciones entre innovacion, exportacion y productividad han demostrado ser complejas pero indican que la innovacion por si sola no es suficiente para generar mejoras en la productividad. Solamente cuando se combina la innovacion con un aumento de la actividad de exportacion son evidentes las ganancias en productividad. Innovacion Servicios Desarrollo regional Productividad Exportaciones Irlanda

Suggested Citation

  • James Love & Stephen Roper & Nola Hewitt-Dundas, 2010. "Service Innovation, Embeddedness and Business Performance: Evidence from Northern Ireland," Regional Studies, Taylor & Francis Journals, vol. 44(8), pages 983-1004.
    • Handle: RePEc:taf:regstd:v:44:y:2010:i:8:p:983-1004
    DOI: 10.1080/00343400903401568
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    References listed on IDEAS

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    1. Hans Loof & Almas Heshmati, 2006. "On the relationship between innovation and performance: A sensitivity analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(4-5), pages 317-344.
    2. Faridah Djellal & Faïz Gallouj, 1998. "Innovation in service industries in France: results of a postal survey," Working Papers hal-01111909, HAL.
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