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Risk attitude, product innovation, and firm growth. Evidence from Italian manufacturing firms

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  • Cucculelli, Marco
  • Ermini, Barbara

Abstract

We study the impact of individual risk attitude on the relationship between product innovation and firm performance, in a model of firm growth with endogenous product selection. We exploit a unique dataset collecting firm-level data on new product introductions and individual attitudes towards risk elicited from a lottery.

Suggested Citation

  • Cucculelli, Marco & Ermini, Barbara, 2013. "Risk attitude, product innovation, and firm growth. Evidence from Italian manufacturing firms," Economics Letters, Elsevier, vol. 118(2), pages 275-279.
    • Handle: RePEc:eee:ecolet:v:118:y:2013:i:2:p:275-279
    DOI: 10.1016/j.econlet.2012.11.006
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    References listed on IDEAS

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    1. Måns Söderbom & Catherine Pattillo, 2000. "Managerial Risk Attitudes and Firm Performance in Ghanaian Manufacturing: an Empirical Analysis Based on Experimental Data," Economics Series Working Papers WPS/2000-17, University of Oxford, Department of Economics.
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    4. Steffen Andersen & Glenn W. Harrison & Morten I. Lau & E. Elisabet Rutström, 2008. "Eliciting Risk and Time Preferences," Econometrica, Econometric Society, vol. 76(3), pages 583-618, May.
    5. Andrew B. Bernard & Stephen J. Redding & Peter K. Schott, 2010. "Multiple-Product Firms and Product Switching," American Economic Review, American Economic Association, vol. 100(1), pages 70-97, March.
    6. Glenn W. Harrison & Morten I. Lau & E. Elisabet Rutström, 2007. "Estimating Risk Attitudes in Denmark: A Field Experiment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 109(2), pages 341-368, June.
    7. Binswanger, Hans P, 1981. "Attitudes toward Risk: Theoretical Implications of an Experiment in Rural India," Economic Journal, Royal Economic Society, vol. 91(364), pages 867-890, December.
    8. Cramer, J. S. & Hartog, J. & Jonker, N. & Van Praag, C. M., 2002. "Low risk aversion encourages the choice for entrepreneurship: an empirical test of a truism," Journal of Economic Behavior & Organization, Elsevier, vol. 48(1), pages 29-36, May.
    9. Elston, Julie Ann & Audretsch, David B., 2010. "Risk attitudes, wealth and sources of entrepreneurial start-up capital," Journal of Economic Behavior & Organization, Elsevier, vol. 76(1), pages 82-89, October.
    10. Avlonitis, George J. & Salavou, Helen E., 2007. "Entrepreneurial orientation of SMEs, product innovativeness, and performance," Journal of Business Research, Elsevier, vol. 60(5), pages 566-575, May.
    11. Catherine Pattillo & Måns Söderbom, 2000. "Managerial Risk Attitudes and Firm Performance in Ghanaian Manufacturing: an Empirical Analysis Based on Experimental Data," CSAE Working Paper Series 2000-17, Centre for the Study of African Economies, University of Oxford.
    12. repec:fth:oxesaf:2000-17 is not listed on IDEAS
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    Cited by:

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    2. Kouame Dangui Dorcas & Bekolo Ngoa Celestin & Shao Yunfei, 2021. "Entrepreneurs Traits/Characteristics and Innovation Performance of Waste Recycling Start-Ups in Ghana: An Application of the Upper Echelons Theory among SEED Award Winners," Sustainability, MDPI, vol. 13(11), pages 1-18, May.
    3. Georgios Giotis & Evangelia Papadionysiou, 2022. "The Role of Managerial and Technological Innovations in the Tourism Industry: A Review of the Empirical Literature," Sustainability, MDPI, vol. 14(9), pages 1-20, April.
    4. Halima Jibril & Stephen Roper, 2022. "Of chickens and eggs: Exporting, innovation novelty and productivity," Working Papers 027, The Productivity Institute.
    5. Giorgio Barba Navaretti & Davide Castellani & Fabio Pieri, 2014. "Age and firm growth: evidence from three European countries," Small Business Economics, Springer, vol. 43(4), pages 823-837, December.
    6. Qian, Kun & Liang, Xinyv & Liu, Xiaofeng, 2023. "Managerial ability, managerial risk taking and innovation performance," Finance Research Letters, Elsevier, vol. 57(C).
    7. Andrea Fracasso & Kun Jiang, 2022. "The performance of private companies in China before and during the global financial crisis: firms’ characteristics and entrepreneurs’ attributes," Economic Change and Restructuring, Springer, vol. 55(2), pages 803-836, May.
    8. Song, Fenghua & Thakor, Anjan, 2022. "Ethics, capital and talent competition in banking," Journal of Financial Intermediation, Elsevier, vol. 52(C).
    9. Li, Shoude & Ni, Jian, 2016. "A dynamic analysis of investment in process and product innovation with learning-by-doing," Economics Letters, Elsevier, vol. 145(C), pages 104-108.
    10. Florentine U. Salmony & Dominik K. Kanbach, 2022. "Personality trait differences across types of entrepreneurs: a systematic literature review," Review of Managerial Science, Springer, vol. 16(3), pages 713-749, April.
    11. Machado Léo, Ricardo & Tello‐Gamarra, Jorge, 2016. "Inovac¸ão em servic¸os: estado da arte e perspectivas futuras [Innovation in services: state of the art and future perspectives]," MPRA Paper 82195, University Library of Munich, Germany, revised 29 Mar 2017.
    12. Zheng, Wei & Li, Bo & Song, Dongping & Li, Yanran, 2023. "Innovative development strategy of a risk-averse firm considering product unreliability under competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 172(C).
    13. Chong Li & Qiuge Yao & Jing Wu & Daoyuan Wang, 2019. "Financialization and Risk Taking of Non-Financial Corporations Empirical Evidence from Chinese Listed Companies," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 9(3), pages 1-5.
    14. Hu, Feng, 2015. "Return to Education for China’s Return Migrant Entrepreneurs," World Development, Elsevier, vol. 72(C), pages 296-307.
    15. Sari Pekkala Kerr & William R. Kerr & Tina Xu, 2017. "Personality Traits of Entrepreneurs: A Review of Recent Literature," NBER Working Papers 24097, National Bureau of Economic Research, Inc.
    16. Maurizio Prosperi & Roberta Sisto & Antonio Lopolito & Valentina C. Materia, 2020. "Local Entrepreneurs’ Involvement in Strategy Building to Facilitate Agro-Food Waste Valorisation within an Agro-Food Technological District: A SWOT-SOR Approach," Sustainability, MDPI, vol. 12(11), pages 1-15, June.
    17. Hyytinen, Ari & Pajarinen, Mika & Rouvinen, Petri, 2015. "Does innovativeness reduce startup survival rates?," Journal of Business Venturing, Elsevier, vol. 30(4), pages 564-581.

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    More about this item

    Keywords

    Risk attitude; Entrepreneurship; Product innovation; Firm growth;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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