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Economic Crisis, Innovation Strategies and Firm Performance. Evidence from Italian Firm-level Data

Author

Listed:
  • Massimiliano Mazzanti

    ()

  • Sandro Montresor
  • Davide Antonioli

    ()

  • Annaflavia Bianchi
  • Paolo Pini

Abstract

Several empirical works have shown the robust and positive relation between growth and innovation at macroeconomic level and between firm economic performance and innovation at microeconomic level. However, the economists have had less opportunities to study such linkages during severe global downturns of the economic cycle. Moreover, the present disruptive economic downturn has forced the firms to implement survival strategies. One of such strategic behaviour regards the way of intervention on product and process areas through innovative actions. Focusing the attention on the micro level, the present work provides an empirical analysis on the basis of more than 500 Italian manufacturing firms located in Emilia-Romagna region, with the aim of disentangling the relations between pre-crisis innovation strategies and firm economic performance during the crisis as well as the linkages between the innovative actions taken to react to the recession's challenges and the economic performance in the recession. The results suggest the existence of strong relationships between past innovative activities and the capacity to react to the challenges brought by the crisis through innovative actions along product, process and organization/HRM dimensions, although the role of complementarities among past innovative activities does not emerge robustly. When the dependent variables are performance indicators the impact of pre-crisis innovation strategies emerges as robust for technological and organizational spheres, while intense innovative activities before the crisis on spheres like ICT, training and environment are detrimental for performances in the crisis. It seems that when the crisis hits those firms in a process of quite radical transformation and change, then the negative economic consequences of the recession are worse than in the case of firms on a more stable, less dynamic path.

Suggested Citation

  • Massimiliano Mazzanti & Sandro Montresor & Davide Antonioli & Annaflavia Bianchi & Paolo Pini, 2011. "Economic Crisis, Innovation Strategies and Firm Performance. Evidence from Italian Firm-level Data," Working Papers 201102, University of Ferrara, Department of Economics.
  • Handle: RePEc:udf:wpaper:201102
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    1. repec:taf:indinn:v:25:y:2018:i:1:p:53-83 is not listed on IDEAS
    2. Florio, Massimo & Graeme, Brad & Astbury, Philip & Armstrong, Harvey W. & Audretsch, David B. & Dermastia, Mateja & Picciotto, Robert & Delponte, Laura & Rampton, James & Sartori, Davide & Vignetti, S, 2016. "Support to SMEs - Increasing research and innovation in SMEs and SME development. Final report. Work package 2," ZEW Expertises, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, number 141310.
    3. Grigorii V. Teplykh, 2018. "Innovations and productivity: the shift during the 2008 crisis," Industry and Innovation, Taylor & Francis Journals, vol. 25(1), pages 53-83, January.
    4. Archibugi, Daniele & Filippetti, Andrea & Frenz, Marion, 2013. "Economic crisis and innovation: Is destruction prevailing over accumulation?," Research Policy, Elsevier, vol. 42(2), pages 303-314.
    5. Peñasco, Cristina & del Río, Pablo & Romero-Jordán, Desiderio, 2017. "Analysing the Role of International Drivers for Eco-innovators," Journal of International Management, Elsevier, vol. 23(1), pages 56-71.
    6. Asgeir Skålholt & Taran Thune, 2014. "Coping with Economic Crises-The Role of Clusters," European Planning Studies, Taylor & Francis Journals, vol. 22(10), pages 1993-2010, October.
    7. FERRAGINA, Anna Maria & MAZZOTTA, Fernanda, 2017. "Firm Employment Resilience and FDI: Evidence from Italy," CELPE Discussion Papers 152, CELPE - Centre of Labour Economics and Economic Policy, University of Salerno, Italy.
    8. repec:krk:eberjl:v:4:y:2016:i:4:p:29-50 is not listed on IDEAS
    9. Adalgiso Amendola & Anna Maria Ferragina & Rosanna Pittiglio & Filippo Reganati, 2012. "Are exporters and multinational firms more resilient over a crisis? First evidence for manufacturing enterprises in Italy," Economics Bulletin, AccessEcon, vol. 32(3), pages 1914-1926.
    10. repec:krk:eberjl:v:4:y:2016:i:1:p:181-191 is not listed on IDEAS
    11. FERRAGINA, Anna Maria, 2013. "The Impact of FDI on Firm Survival and Employment: A Comparative Analysis for Turkey and Italy," CELPE Discussion Papers 127, CELPE - Centre of Labour Economics and Economic Policy, University of Salerno, Italy.
    12. Nabil Abou Lebdi & Katrin Hussinger, 2016. "Startup Innovation during the Past Economic Crisis," CREA Discussion Paper Series 16-27, Center for Research in Economic Analysis, University of Luxembourg.

    More about this item

    Keywords

    innovation strategies; economic crisis; firm performance;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • 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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