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Are in-house and outsourcing innovation strategies interlinked? Evidence from the European agri-food sector

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  • Materia, Valentina
  • Pascucci, Stefano
  • Dries, Liesbeth

Abstract

The paper investigates the determinants of innovation strategies in the agri-food sector and the potential complementarity of these strategies. Innovation strategies are distinguished as in-house and outsourcing. The choice between strategies is motivated by transaction cost minimization, property rights appropriation and optimization of firms’ resources and competences. A bivariate probit model is implemented using cross-section data on 1,393 agri-food firms in seven EU countries. Results show that: decisions to innovate in-house or to outsource are not interlinked; high quality human resources and the use of ICT influence both the decision to innovate in-house and outsourcing, while organizational aspects, especially those related to decision-making within the firm, are relevant only for in-house innovation. Finally, we also find that large and internationalized firms are more likely to innovate in-house.

Suggested Citation

  • Materia, Valentina & Pascucci, Stefano & Dries, Liesbeth, 2015. "Are in-house and outsourcing innovation strategies interlinked? Evidence from the European agri-food sector," 2015 Conference, August 9-14, 2015, Milan, Italy 212449, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae15:212449
    DOI: 10.22004/ag.econ.212449
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    Consumer/Household Economics; Food Consumption/Nutrition/Food Safety;

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