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Innovation capabilities and firm labor productivity

Author

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  • Carine Peeters
  • Bruno Van Pottelsberghe

Abstract

This study relies on a Cobb-Douglas production function to assess the relationship between the development of innovation capabilities by firms and their labor productivity. Intra-organizational capabilities relate to firms’ corporate culture and work organization, generation of innovative ideas and selection of projects, and innovation funding sources. Inter-organizational capabilities relate to the use of external information from vertical partners, competitors, and consultants, and to R&D partnerships with scientific institutions. In addition to the traditional effect of a growth in the ratio of physical capital per employee, both types of innovation capabilities are found to significantly increase labor productivity.

Suggested Citation

  • Carine Peeters & Bruno Van Pottelsberghe, 2004. "Innovation capabilities and firm labor productivity," Working Papers CEB 04-030.RS, ULB -- Universite Libre de Bruxelles.
  • Handle: RePEc:sol:wpaper:04-030
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    References listed on IDEAS

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    5. Peeters, Carine & Pottelsberghe de la Potterie, Bruno van, 2003. "Organizational Competencies and Innovation Performances: The Case of Large Firms in Belgium," IIR Working Paper 03-19, Institute of Innovation Research, Hitotsubashi University.
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    Cited by:

    1. Salih Ye?il & Ahmet Kaya, 2015. "Exploring the link between innovation capability and financial performance," Proceedings of Business and Management Conferences 2303841, International Institute of Social and Economic Sciences.

    More about this item

    Keywords

    Innovation; organizational capabilities; performance; labor productivity.;

    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
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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