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Innovation, Competition and Productivity. Firm Level Evidence for Eastern Europe and Central Asia

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  • Klaus S. Friesenbichler
  • Michael Peneder

Abstract

We investigate the drivers of firm level productivity in catching-up economies by jointly estimating its relationship to innovation and competition using data from the EBRD-WB Business Environment and Enterprise Performance Survey (BEEPS) in Eastern Europe and Central Asia. The findings confirm an inverted-U shaped impact of competition on R&D. Both competition and innovation have a simultaneous positive effect on labour productivity in terms of either sales or value added per employee, as does a high share of university graduates and foreign ownership. Further positive impacts come from firm size, exports, or population density. Innovation and foreign ownership appear to be the strongest drivers of multifactor productivity.

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  • Klaus S. Friesenbichler & Michael Peneder, 2016. "Innovation, Competition and Productivity. Firm Level Evidence for Eastern Europe and Central Asia," WIFO Working Papers 516, WIFO.
  • Handle: RePEc:wfo:wpaper:y:2016:i:516
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    References listed on IDEAS

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    Cited by:

    1. Michael Peneder & Fabian Unterlass, 2024. "Die Produktivitätsentwicklung österreichischer Unternehmen in den Jahren 2013 bis 2020. Eine Auswertung von Mikrodaten," WIFO Monatsberichte (monthly reports), WIFO, vol. 97(2), pages 43-56, February.
    2. Teimuraz Gogokhia & George Berulava, 2021. "Business environment reforms, innovation and firm productivity in transition economies," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 11(2), pages 221-245, June.
    3. Nieto, María Jesús & Rodríguez, Alicia & Hernández, Virginia, 2022. "International sourcing and the productivity of SMEs in transition countries: Formal and informal ‘region effects’ and the communist footprint," Journal of Business Research, Elsevier, vol. 145(C), pages 347-359.
    4. Michael Peneder & Spyros Arvanitis & Christian Rammer & Tobias Stucki & Martin Wörter, 2022. "Policy instruments and self-reported impacts of the adoption of energy saving technologies in the DACH region," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 49(2), pages 369-404, May.
    5. Berulava, George & Gogokhia, Teimuraz, 2016. "Studying Complementarities between Modes of Innovation Strategies in Transition Economies," MPRA Paper 71277, University Library of Munich, Germany.
    6. Saša Petković & Jelica Rastoka & Dragana Radicic, 2023. "Impact of Innovation and Exports on Productivity: Are There Complementary Effects?," Sustainability, MDPI, vol. 15(9), pages 1-22, April.
    7. Hoang, Ngoc & Nahm, Daehoon & Dobbie, Michael, 2021. "Innovation, gender, and labour productivity: Small and medium enterprises in Vietnam," World Development, Elsevier, vol. 146(C).
    8. Asif Islam & Gregmar I. Galinato & Wentao Zhang, 2021. "Can government spending boost firm sales?," Kyklos, Wiley Blackwell, vol. 74(4), pages 488-511, November.
    9. Ilija Moric & Jelena Šaković Jovanović & Rajka Đoković & Sanja Peković & Đurđica Perović, 2020. "The Effect of Phases of the Adoption of the Circular Economy on Firm Performance: Evidence from 28 EU Countries," Sustainability, MDPI, vol. 12(6), pages 1-12, March.
    10. Anabela Santos & Karel Haegeman & Pietro Moncada-Paternó-Castello, 2021. "The impact of Covid-19 and of the earlier crisis on firms’ innovation and growth: a comparative analysis," JRC Working Papers on Territorial Modelling and Analysis 2021-03, Joint Research Centre.
    11. Michael Peneder & Catherine Prettner, 2021. "Entwicklung der Produktivität österreichischer Unternehmen von 2008 bis 2018. Auswertung von Mikrodaten für Österreich im Rahmen von Multiprod 2.0," WIFO Studies, WIFO, number 67450.
    12. Devesh Singh & Sunil Kumar Dhiman, 2023. "The linkage between carbon emissions, foreign direct investment, economic growth, and gross value added," Journal of Environmental Studies and Sciences, Springer;Association of Environmental Studies and Sciences, vol. 13(1), pages 156-176, March.
    13. Luca Farè, 2022. "Exploring the contribution of micro firms to innovation: does competition matter?," Small Business Economics, Springer, vol. 59(3), pages 1081-1113, October.
    14. Berulava, George & Gogokhia, Teimuraz, 2021. "The Impact of Business Environment Reforms on Firms’ Performance in Transition Economies," MPRA Paper 106327, University Library of Munich, Germany.

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    Keywords

    innovation; competition; productivity; development; transition economies; simultaneous system TP_Wettbewerbsfaehigkeit_Produktion;
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