IDEAS home Printed from https://ideas.repec.org/p/xjt/rieiwp/2018-01.html
   My bibliography  Save this paper

Innovation and Productivity in the service sector of emerging and developing countries

Author

Listed:
  • Regis, Paulo José

    () (Division of Economics, Xi'an Jiaotong-Liverpool University)

  • Desmarchelier, Benoît

    () (Lille 1 University)

Abstract

This paper conducts a large cross-country study of innovation decisions and its effect on the productivity of the firms in the service sectors in developing countries. A structural model relating innovation and productivity is fitted with data from 97 emerging and developing countries. We find that R&D generates gains in labor productivity as well as in terms of an aggregate measure of capital and total factor productivity. However, the introduction of new products does not seem to have relevant impact on productivity measures. From a policy perspective, we find that tax burden and difficulties to access credit are significant obstacles to innovation in services. Considering the positive relationship between service innovation and productivity, these obstacles should be on top of policy agenda in the countries under study. Finally, competition from the international market and from the informal sector are both fostering innovation in services.

Suggested Citation

  • Regis, Paulo José & Desmarchelier, Benoît, 2018. "Innovation and Productivity in the service sector of emerging and developing countries," RIEI Working Papers 2018-01, Xi'an Jiaotong-Liverpool University, Research Institute for Economic Integration.
  • Handle: RePEc:xjt:rieiwp:2018-01
    as

    Download full text from publisher

    File URL: http://58.210.89.21/RePEc/xjt/working-papers/RIEI-WP_2018-01.pdf
    File Function: First version, 2017
    Download Restriction: no

    References listed on IDEAS

    as
    1. Winter, Sidney G., 1984. "Schumpeterian competition in alternative technological regimes," Journal of Economic Behavior & Organization, Elsevier, vol. 5(3-4), pages 287-320.
    2. Faridah Djellal & Dominique Francoz & Camal Gallouj & Faïz Gallouj & Yves Jacquin, 2003. "Revising the definition of research and development in the light of the specificities of services," Science and Public Policy, Oxford University Press, vol. 30(6), pages 415-429, December.
    3. Konan, Denise Eby & Maskus, Keith E., 2006. "Quantifying the impact of services liberalization in a developing country," Journal of Development Economics, Elsevier, vol. 81(1), pages 142-162, October.
    4. Giulio Cainelli & Rinaldo Evangelista & Maria Savona, 2006. "Innovation and economic performance in services: a firm-level analysis," Cambridge Journal of Economics, Oxford University Press, vol. 30(3), pages 435-458, May.
    5. Cohen, Wesley M & Klepper, Steven, 1996. "A Reprise of Size and R&D," Economic Journal, Royal Economic Society, vol. 106(437), pages 925-951, July.
    6. Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
    7. Baumol, William J & Blackman, Sue Anne Batey & Wolff, Edward N, 1985. "Unbalanced Growth Revisited: Asymptotic Stagnancy and New Evidence," American Economic Review, American Economic Association, vol. 75(4), pages 806-817, September.
    8. Lutz Schneider & Jutta Gunther & Bianca Brandenburg, 2010. "Innovation and skills from a sectoral perspective: a linked employer-employee analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 19(2), pages 185-202.
    9. Rachel Griffith & Elena Huergo & Jacques Mairesse & Bettina Peters, 2006. "Innovation and Productivity Across Four European Countries," Oxford Review of Economic Policy, Oxford University Press, vol. 22(4), pages 483-498, Winter.
    10. Mary O'Mahony & Marcel P. Timmer, 2009. "Output, Input and Productivity Measures at the Industry Level: The EU KLEMS Database," Economic Journal, Royal Economic Society, vol. 119(538), pages 374-403, June.
    11. Tarek M. Harchaoui, 2016. "The Europe–U.S. Productivity Gap In A Rear-View Mirror: Will Measurement Differences In The Services Sector Output Please Rise?," Journal of Economic Surveys, Wiley Blackwell, vol. 30(1), pages 93-116, February.
    12. Scherer, F M, 1992. "Schumpeter and Plausible Capitalism," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1416-1433, September.
    13. Crepon, B. & Duguet, E. & Mairesse, J., 1998. "Research Investment, Innovation and Productivity: An Econometric Analysis at the Firm Level," Papiers d'Economie Mathématique et Applications 98.15, Université Panthéon-Sorbonne (Paris 1).
    14. Hans Loof & Almas Heshmati, 2006. "On the relationship between innovation and performance: A sensitivity analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(4-5), pages 317-344.
    15. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    16. Huergo, Elena & Jaumandreu, Jordi, 2004. "Firms' age, process innovation and productivity growth," International Journal of Industrial Organization, Elsevier, vol. 22(4), pages 541-559, April.
    17. Abramovitz, Moses, 1993. "The Search for the Sources of Growth: Areas of Ignorance, Old and New," The Journal of Economic History, Cambridge University Press, vol. 53(2), pages 217-243, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    innovation; productivity; services sector; developing countries;

    JEL classification:

    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • C34 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Truncated and Censored Models; Switching Regression Models
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:xjt:rieiwp:2018-01. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Paulo Regis). General contact details of provider: http://edirc.repec.org/data/rixjtcn.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.