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Non-technological and Technological Innovation: Strange Bedfellows?

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  • Schmidt, Tobias
  • Rammer, Christian

Abstract

Non-technological innovation is an important element of firms? innovation activities that both supplement and complement technological innovation, i.e. the introduction of new products and new processes. We analyse the spread of nontechnological innovation in firms, their relation to technological innovation, and their effects to firm performance and success with product and process innovation, using data from the German Community Innovation Survey conducted in 2005 (German CIS 4). Non-technological innovation is defined as the introduction of new organisational methods or the introduction of new marketing methods. We find that the determinants of a firm?s propensity to introduce technological and non-technological innovations are very similar and that both types are closely related. There are only small effects of non-technological innovation on a firm? profit margin, which contrasts the strong effects to be found from technological innovation. However, non-technological innovation spurs success with product and process innovation terms of sales with market novelties and cost reductions from new processes.

Suggested Citation

  • Schmidt, Tobias & Rammer, Christian, 2007. "Non-technological and Technological Innovation: Strange Bedfellows?," ZEW Discussion Papers 07-052, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:6355
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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