IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Openness, knowledge, innovation and growth in UK business services

  • Love, James H.
  • Roper, Stephen
  • Bryson, John R.

We explore the causal links between service firms’ knowledge investments, their innovation outputs and business growth based on a bespoke survey of around 1100 UK service businesses. We combine the activity based approach of the innovation value chain with firms’ external links at each stage of the innovation process. This introduces the concept of ‘encoding’ relationships through which learning improves the effectiveness of firms’ innovation processes. Our econometric results emphasise the importance of external openness in the initial, exploratory phase of the innovation process and the significance of internal openness (e.g. team working) in later stages of the process. In-house design capacity is strongly linked to a firm's ability to absorb external knowledge for innovation. Links to customers are important in the exploratory stage of the innovation process, but encoding linkages with private and public research organisations are more important in developing innovation outputs. Business growth is related directly to both the extent of firms’ service innovation as well as the diversity of innovation, reflecting marketing, strategic and business process change.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/pii/S0048733311000977
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Research Policy.

Volume (Year): 40 (2011)
Issue (Month): 10 ()
Pages: 1438-1452

as
in new window

Handle: RePEc:eee:respol:v:40:y:2011:i:10:p:1438-1452
Contact details of provider: Web page: http://www.elsevier.com/locate/respol

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Roper, Stephen & Du, Jun & Love, James H., 2008. "Modelling the innovation value chain," Research Policy, Elsevier, vol. 37(6-7), pages 961-977, July.
  2. Amemiya, Takeshi, 1978. "The Estimation of a Simultaneous Equation Generalized Probit Model," Econometrica, Econometric Society, vol. 46(5), pages 1193-1205, September.
  3. Crepon, B. & Duguet, E. & Mairesse, J., 1998. "Research Investment, Innovation and Productivity: An Econometric Analysis at the Firm Level," Papiers d'Economie Mathématique et Applications 98.15, Université Panthéon-Sorbonne (Paris 1).
  4. Kox, Henk L.M. & Rubalcaba, Luis, 2007. "Business services and the changing structure of European economic growth," MPRA Paper 3750, University Library of Munich, Germany.
  5. Wakelin, Katharine, 1998. "Innovation and export behaviour at the firm level," Research Policy, Elsevier, vol. 26(7-8), pages 829-841, April.
  6. Albert N. Link & David Paton & Donald S. Siegel, 2005. "An econometric analysis of trends in research joint venture activity," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 149-158.
  7. Giulio Cainelli & Rinaldo Evangelista & Maria Savona, 2006. "Innovation and economic performance in services: a firm-level analysis," Cambridge Journal of Economics, Oxford University Press, vol. 30(3), pages 435-458, May.
  8. Schmidt, Tobias, 2005. "Absorptive Capacity: One Size Fits All? Firm-level Analysis of Absorptive Capacity for Different Kinds of Knowledge," ZEW Discussion Papers 05-72, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  9. Evans, David S, 1987. "The Relationship between Firm Growth, Size, and Age: Estimates for 100 Manufacturing Industries," Journal of Industrial Economics, Wiley Blackwell, vol. 35(4), pages 567-81, June.
  10. Christian Zeller, 2002. "Project Teams as Means of Restructuring Research and Development in the Pharmaceutical Industry," Regional Studies, Taylor & Francis Journals, vol. 36(3), pages 275-289.
  11. Leiponen, Aija, 2005. "Skills and innovation," International Journal of Industrial Organization, Elsevier, vol. 23(5-6), pages 303-323, June.
  12. Newey, Whitney K., 1987. "Efficient estimation of limited dependent variable models with endogenous explanatory variables," Journal of Econometrics, Elsevier, vol. 36(3), pages 231-250, November.
  13. Tether, Bruce S. & Tajar, Abdelouahid, 2008. "The organisational-cooperation mode of innovation and its prominence amongst European service firms," Research Policy, Elsevier, vol. 37(4), pages 720-739, May.
  14. Lööf, Hans & Heshmati, Almas, 2000. "Knowledge Capital and Performance Heterogeneity: A Firm Level Innovation Study," SSE/EFI Working Paper Series in Economics and Finance 387, Stockholm School of Economics, revised 14 Aug 2000.
  15. Knockaert, M. & Ucbasaran, D. & Wright, M. & Clarysse, B., 2009. "How does tacit knowledge transfer influence innovation speed? The case of science based entrepreneurial firms," Vlerick Leuven Gent Management School Working Paper Series 2009-07, Vlerick Leuven Gent Management School.
  16. Jason Potts & Tom Mandeville, 2007. "Toward an Evolutionary Theory of Innovation and Growth in the Service Economy," Prometheus, Taylor & Francis Journals, vol. 25(2), pages 147-159.
  17. Rachel Griffith & Stephen Redding & John Van Reenen, 2003. "R&D and absorptive capacity : theory and empirical evidence," LSE Research Online Documents on Economics 209, London School of Economics and Political Science, LSE Library.
  18. Muller, Emmanuel & Zenker, Andrea, 2001. "Business services as actors of knowledge transformation: the role of KIBS in regional and national innovation systems," Research Policy, Elsevier, vol. 30(9), pages 1501-1516, December.
  19. Czarnitzki, Dirk & Spielkamp, Alfred, 2000. "Business services in Germany: bridges for innovation," ZEW Discussion Papers 00-52, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  20. repec:fth:inseep:9833 is not listed on IDEAS
  21. Bruno Crépon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation and Productivity : An Econometric Analysis at the Firm Level," Working Papers 98-33, Centre de Recherche en Economie et Statistique.
  22. 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.
  23. Stoneman, Paul, 2011. "Soft Innovation: Economics, Product Aesthetics, and the Creative Industries," OUP Catalogue, Oxford University Press, number 9780199697021, March.
  24. Klette, T.J. & Moen, J. & Griliches, Z., 1999. "Do Subsidies to Commercial R&D Reduce Market Failures? Microeconometric Evaluation Studies," Papers 16/99, Norwegian School of Economics and Business Administration-.
  25. Roper, Stephen & Love, James H., 2002. "Innovation and export performance: evidence from the UK and German manufacturing plants," Research Policy, Elsevier, vol. 31(7), pages 1087-1102, September.
  26. Lööf, Hans & Heshmati, Almas, 2001. "On the Relationship between Innovation and Performance: A sensitivity Analysis," SSE/EFI Working Paper Series in Economics and Finance 0446, Stockholm School of Economics, revised 01 Oct 2001.
  27. Luukkonen, Terttu, 2000. "Additionality of EU framework programmes1," Research Policy, Elsevier, vol. 29(6), pages 711-724, June.
  28. Richard Whitley, 2006. "Project-based firms: new organizational form or variations on a theme?," Industrial and Corporate Change, Oxford University Press, vol. 15(1), pages 77-99, February.
  29. Bruce Tether, 2005. "Do Services Innovate (Differently)? Insights from the European Innobarometer Survey," Industry and Innovation, Taylor & Francis Journals, vol. 12(2), pages 153-184.
  30. Geroski, P A, 1990. "Innovation, Technological Opportunity, and Market Structure," Oxford Economic Papers, Oxford University Press, vol. 42(3), pages 586-602, July.
  31. Knut Blind & Andre Jungmittag, 2004. "Foreign Direct Investment, Imports and Innovations in the Service Industry," Review of Industrial Organization, Springer, vol. 25(2), pages 205-227, 06.
  32. Tomas Del Barrio-Castro & Jose Garcia-Quevedo, 2005. "Effects of university research on the geography of innovation," Regional Studies, Taylor & Francis Journals, vol. 39(9), pages 1217-1229.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eee:respol:v:40:y:2011:i:10:p:1438-1452. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.