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Don't Stop Me Now: Barriers to innovation and firm productivity

Author

Listed:
  • Alex Coad

    (SPRU, University of Sussex, UK)

  • Maria Savona

    () (SPRU, University of Sussex, UK)

  • Gabriele Pellegrino

    (Barcelona Institute of Economics, University of Barcelona)

Abstract

This paper analyses the effect of financial, knowledge, demand, market structure and regulation barriers to innovation on firms’ economic performance. It contributes to the literature on barriers to innovation in a two-fold way. First, it disentangles the mediated effect of obstacles, via product, process and organisational innovation, on labour productivity. Second, it accounts for the differentiated effect that each of the barriers has on firms positioned along the productivity distribution. We do so by employing both quantile regression techniques and propensity score matching on the UK CIS panel 2002-2010 merged with the Business Structure database. While we find evidence that financial obstacles negatively affect productivity across the distribution, and are more pronounced for young rather than small firms, knowledge and regulatory obstacles mostly affect high productivity firms. Interestingly, the perceptions of market structure and demand obstacles are positively associated to productivity performance, confirming their “revealed” rather than “deterring” nature.

Suggested Citation

  • Alex Coad & Maria Savona & Gabriele Pellegrino, 2014. "Don't Stop Me Now: Barriers to innovation and firm productivity," SPRU Working Paper Series 2014-04, SPRU - Science and Technology Policy Research, University of Sussex.
  • Handle: RePEc:sru:ssewps:2014-04
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    File URL: http://www.sussex.ac.uk/spru/documents/2014-04-swps-coad-pellegrino-savona.pdf
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    Cited by:

    1. Nestor Duch-Brown & Andrea de Panizza & Ibrahim Kholilul Rohman, 2016. "Innovation and productivity in a S&T intensive sector: the case of Information industries in Spain," JRC Working Papers JRC101847, Joint Research Centre (Seville site).

    More about this item

    Keywords

    Barriers to innovation; labour productivity; quantile regressions; propensity score matching;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • 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

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