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Innovation in family and non-family SMEs: an exploratory analysis

Author Info

  • Nicolas Classen

    ()

  • Martin Carree
  • Anita Gils
  • Bettina Peters

Abstract

This study provides an exploratory analysis of differences between family and non-family firms in innovation investment, product and process innovation outcomes, and labor productivity. Using data from the Community Innovation Survey on 2,087 German small- and medium-sized enterprises (SMEs), we observe significant disparities at each stage of the innovation process. Whereas family SMEs have a higher propensity to invest in innovation at all, conditional on investing in innovation, these companies do so less intensively than their non-family counterparts. Family SMEs further tend to outperform non-family SMEs in terms of process innovation outcomes when controlling for innovation investment. Given the level of product and process innovation, however, family SMEs underperform regarding labor productivity in comparison to non-family SMEs. These findings complement previous empirical research by illustrating how the presence of a dominant family relates to innovation inputs and outputs of SMEs in Europe’s largest economy and its innovative SME sector. Copyright Springer Science+Business Media New York 2014

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File URL: http://hdl.handle.net/10.1007/s11187-013-9490-z
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Article provided by Springer in its journal Small Business Economics.

Volume (Year): 42 (2014)
Issue (Month): 3 (March)
Pages: 595-609

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Handle: RePEc:kap:sbusec:v:42:y:2014:i:3:p:595-609
Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100338

Keywords: Family firms; Innovation investment; Product innovation; Process innovation; Productivity; O32; L26; C31;

Find related papers by JEL classification:

  • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
  • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
  • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models

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Cited by:

  1. López-Delgado, P. & Diéguez-Soto, J., 2015. "Lone founders, types of private family businesses and firm performance," Journal of Family Business Strategy, Elsevier, vol. 6(2), pages 73-85.
  2. D’Angelo, Alfredo & Majocchi, Antonio & Buck, Trevor, 2016. "External managers, family ownership and the scope of SME internationalization," Journal of World Business, Elsevier, vol. 51(4), pages 534-547.
  3. Schlömer-Laufen, Nadine & Kay, Rosemarie & Holz, Michael, 2014. "Works councils in family businesses in Germany: Why are there so few?," Working Papers 03/14, Institut für Mittelstandsforschung (IfM) Bonn.
  4. Jahn, Vera & Berlemann, Michael, 2014. "Governance, Firm Size and Innovative Capacity: Regional Empirical Evidence for Germany," Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100412, Verein für Socialpolitik / German Economic Association.
  5. Nuno Campos Pereira & Nuno Araújo & Leonardo Costa, 2016. "A counting multidimensional innovation index for SMEs," Working Papers de Economia (Economics Working Papers) 01, Católica Porto Business School, Universidade Católica Portuguesa.
  6. Werner, Arndt & Schröder, Christian & Mohr, Benjamin, 2013. "Innovationstätigkeit von Familienunternehmen," IfM-Materialien 225, Institut für Mittelstandsforschung (IfM) Bonn.
  7. Rammer, Christian & Schubert, Torben & Hünermund, Paul & Köhler, Mila & Iferd, Younes & Peters, Bettina, 2016. "Dokumentation zur Innovationserhebung 2015," ZEW Dokumentationen 16-01, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  8. Stough, Roger & Welter, Friederike & Block, Joern & Wennberg, Karl & Basco, Rodrigo, 2015. "Family business and regional science: “Bridging the gap”," Journal of Family Business Strategy, Elsevier, vol. 6(4), pages 208-218.

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