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Product innovation and the decision to invest in fixed capital assets: Evidence from an SME survey in six European Union member states

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  • Skuras, Dimitris
  • Tsegenidi, Kyriaki
  • Tsekouras, Kostas

Abstract

This work explores the relationship between product innovation and the decision to invest in fixed capital assets among a sample of SMEs in six European Union countries located in both peripheral and more central areas. We find that the presence of product innovation reduces the probability to invest. A firm's size exerts a direct, inverted U-shape effect on the probability to invest and an indirect effect through the linear effect of size on the probability to innovate. The gap in the probability to invest between innovative and non-innovative firms increases with size.

Suggested Citation

  • Skuras, Dimitris & Tsegenidi, Kyriaki & Tsekouras, Kostas, 2008. "Product innovation and the decision to invest in fixed capital assets: Evidence from an SME survey in six European Union member states," Research Policy, Elsevier, vol. 37(10), pages 1778-1789, December.
  • Handle: RePEc:eee:respol:v:37:y:2008:i:10:p:1778-1789
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    References listed on IDEAS

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    Cited by:

    1. James Foreman-Peck, 2013. "Effectiveness and efficiency of SME innovation policy," Small Business Economics, Springer, vol. 41(1), pages 55-70, June.
    2. Wioletta Czemiel-Grzybowska & Monika Walicka, 2013. "R&D activity, innovativeness and enterprise exporting," Ekonomia i Prawo, Uniwersytet Mikolaja Kopernika, vol. 12(4), pages 613-626, December.
    3. Spyros Arvanitis & Areti Gkypali & Kostas Tsekouras, 2014. "Knowledge Base, Exporting Activities, Innovation Openness and Innovation Performance," KOF Working papers 14-361, KOF Swiss Economic Institute, ETH Zurich.
    4. von Germeten, Jan-Paul & Hartmann, Monika, 2015. "What determines suppliers' intensity of participation in the EU School Fruit Scheme," 2015 Conference, August 9-14, 2015, Milan, Italy 211915, International Association of Agricultural Economists.
    5. repec:mje:mjejnl:v:12:y:2016:i:4:p:53-63 is not listed on IDEAS
    6. Ozer, Muammer, 2009. "The roles of product lead-users and product experts in new product evaluation," Research Policy, Elsevier, vol. 38(8), pages 1340-1349, October.

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