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The Role of Innovation and Management Practices in Determining Firm Productivity

Author

Listed:
  • Wiebke Bartz-Zuccala

    () (OECD)

  • Pierre Mohnen

    () (UNU-MERIT and Maastricht University)

  • Helena Schweiger

    () (European Bank for Reconstruction and Development)

Abstract

Abstract In this paper, we compare the impacts of management practices and innovation on productivity, using data from a unique firm-level survey covering 30 countries in Eastern Europe and Central Asia in the period 2011–2014. We estimate a structural model linking productivity to innovation activities and management practices. Results suggest that both returns to innovation and returns to management practices are important drivers of productivity. However, productivity in lower-income economies is affected to a larger extent by management practices than by innovation, while the opposite holds in higher-income economies. These results imply that firms operating in less favourable business environments can reap large productivity gains by improving the quality of management practices, before engaging in innovation through imitating and adapting foreign technologies.

Suggested Citation

  • Wiebke Bartz-Zuccala & Pierre Mohnen & Helena Schweiger, 2018. "The Role of Innovation and Management Practices in Determining Firm Productivity," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 60(4), pages 502-530, December.
  • Handle: RePEc:pal:compes:v:60:y:2018:i:4:d:10.1057_s41294-018-0075-3
    DOI: 10.1057/s41294-018-0075-3
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    References listed on IDEAS

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    Keywords

    Innovation; Management practices; Productivity;

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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