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Environmental Dynamism, Firm Size and the Economic Productivity of R&D

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  • Antonio Revilla
  • Zulima Fern�ndez

Abstract

The effects of firm size on innovative activity have been extensively debated in the literature, with generally inconclusive results. This study poses a contingent framework in which environmental dynamism moderates the effects of firm size on the returns to research and development (R&D) investments. We hypothesize that dynamic environments favor small firms, as they reward organizational flexibility and promote the development of the markets for technology. Empirical evidence obtained on a sample of Spanish manufacturing firms shows that technological, but not market, dynamism negatively moderates the effects of firm size on the economic productivity of R&D, thus contributing to the success of research efforts by small firms vis-�-vis those of larger corporations.

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  • Antonio Revilla & Zulima Fern�ndez, 2013. "Environmental Dynamism, Firm Size and the Economic Productivity of R&D," Industry and Innovation, Taylor & Francis Journals, vol. 20(6), pages 503-522, August.
    • Handle: RePEc:taf:indinn:v:20:y:2013:i:6:p:503-522
    DOI: 10.1080/13662716.2013.833374
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