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The link between innovation and productivity in Estonia's services sector

Listed author(s):
  • Jaan Masso
  • Priit Vahter

This paper investigates how the innovation--productivity relationship differs across various sub-branches of the services sector. The Crépon, Duguet and Mairesse structural model is used, consisting of equations for innovation expenditures, innovation output, productivity and exports. The data are taken from the Community Innovation Surveys for Estonia. It is shown that innovation is associated with increased productivity. The results indicate, surprisingly, that the association between technological innovation and productivity is stronger in the less knowledge-intensive service (KIS) sectors. Non-technological innovation plays a positive role especially in KISs. An indirect channel of the effects of innovation on productivity appears to function through increased exports.

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File URL: http://hdl.handle.net/10.1080/02642069.2011.600444
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Article provided by Taylor & Francis Journals in its journal The Service Industries Journal.

Volume (Year): 32 (2012)
Issue (Month): 16 (December)
Pages: 2527-2541

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Handle: RePEc:taf:servic:v:32:y:2012:i:16:p:2527-2541
DOI: 10.1080/02642069.2011.600444
Contact details of provider: Web page: http://www.tandfonline.com/FSIJ20

Order Information: Web: http://www.tandfonline.com/pricing/journal/FSIJ20

References listed on IDEAS
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  1. 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.
  2. Bart van Ark & Mary O'Mahoney & Marcel P. Timmer, 2008. "The Productivity Gap between Europe and the United States: Trends and Causes," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 25-44, Winter.
  3. Antonio Musolesi & Jean-Pierre Huiban, 2010. "Innovation and productivity in knowledge intensive business services," Journal of Productivity Analysis, Springer, vol. 34(1), pages 63-81, August.
  4. Lööf, Hans & Heshmati, Almas & Asplund, Rita & Nåås, Svein-Olav, 2001. "Innovation and Performance in Manufacturing Industries: A Comparison of the Nordic Countries," SSE/EFI Working Paper Series in Economics and Finance 0457, Stockholm School of Economics.
  5. Hans Loof & Almas Heshmati, 2006. "On the relationship between innovation and performance: A sensitivity analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(4-5), pages 317-344.
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