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The relationship between technology, innovation, and firm performance--Empirical evidence from e-business in Europe

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  • Koellinger, Philipp

Abstract

This article analyzes the relationship between the usage of Internet-based technologies, different types of innovation, and performance at the firm level. Data for the empirical investigation originates from a sample of 7302 European enterprises. The empirical results show that Internet-based technologies were an important enabler of innovation in the year 2003. It was found that all studied types of innovation, including Internet-enabled and non-Internet-enabled product or process innovations, are positively associated with turnover and employment growth. Firms that rely on Internet-enabled innovations are at least as likely to grow as firms that rely on non-Internet-enabled innovations. Finally, it was found that innovative activity is not necessarily associated with higher profitability. Possible reasons for this and implications are discussed.

Suggested Citation

  • Koellinger, Philipp, 2008. "The relationship between technology, innovation, and firm performance--Empirical evidence from e-business in Europe," Research Policy, Elsevier, vol. 37(8), pages 1317-1328, September.
  • Handle: RePEc:eee:respol:v:37:y:2008:i:8:p:1317-1328
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