Hindering Factors to Innovation: A Panel Data Analysis

Costa, Joana; Botelho, Anabela; Matias, João

doi:10.1007/978-3-319-89336-5_12

Joana Costa⁷,
Anabela Botelho⁷ &
João Matias⁷

Part of the book series: Studies on Entrepreneurship, Structural Change and Industrial Dynamics ((ESID))

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3 Citations

Abstract

The existence of companies developing innovative activities is a key factor for a competitive economy. Firms recognize the importance of performing innovative activities to raise their productivity and create an advantage towards their competitors, consolidate its position in the market and gain extra profits.

Innovation projects have a very uncertain outcome, thus exposing the firm to additional risks. When the economic environment is adverse, firms tend to reduce the amount spent in R&D and deleverage innovative activities. As many innovation projects succeed, others fail. Very often firms decide to abandon their innovative projects which were jeopardized for several obstacles.

The obstacles to innovation perceived by the firms will depend on their particular characteristics. The type of innovation being performed will naturally involve a different variety and extent of resources, moreover, the stage of the process will require the use of different resources with various intensities.

Using a panel of firms collected from the Portuguese CIS, we observe that the abandon of innovative activities fell during the crisis, contrarily to our first expectation. This finding reinforces the suspicions that firms continue their innovative actions in turbulent environments such as the crisis, going along with the Schumpeter Mark I hypothesis. A deep understanding about the effective the role of the different type of barriers firms face in their innovative process will allow the design of more accurate policy recommendations.

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Authors and Affiliations

GOVCOPP and DEGEIT, University of Aveiro, Aveiro, Portugal
Joana Costa, Anabela Botelho & João Matias

Authors

Joana Costa
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Anabela Botelho
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João Matias
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Corresponding author

Correspondence to Joana Costa .

Editor information

Editors and Affiliations

Department of Business Administration, University of Verona, Verona, Italy
Serena Cubico
Department of Business Administration, University of Verona, Verona, Italy
Giuseppe Favretto
Department of Management and Economics, University of Beira Interior, Covilhã, Portugal
João Leitão
Friedrich Schiller University Jena, Jena, Germany
Uwe Cantner

Appendices

Appendix 1 1.1 Model 1: Determinants of the Abandon of the Innovative Activities Random Effects Probit Regression—General Model

Variable	Description	Estimate	SE	ρ-value	[95% Conf. Interval]
_Isize_3	Firm Size—Medium	0.038	0.098	0.697	−0.154	0.230
_Isize_4	Firm Size—Large	0.143	0.116	0.217	−0.084	0.370
group	Economic Group	−0.103	0.095	0.276	−0.289	0.083
_Itech_inte_2	Tech Intensity—Mid Tech	−0.092	0.114	0.417	−0.315	0.130
_Itech_inte_3	Tech Intensity—High Tech	−0.045	0.107	0.674	−0.254	0.164
innov_general	In in one vector (at least)	−0.870	0.373	0.02	−1.601	−0.139
Exp/RD_TOTAL	Exp RD T (RDTOTAL) €	7.54 × 10⁻⁹	7.01 × 10⁻⁹	0.282	−6.2 × 10⁻⁹	2.13 × 10⁻⁸
FUNDS_GEN	Use of funds to innovate	0.064	0.087	0.461	−0.107	0.235
OPENNESS	Openness to sou innov	0.018	0.025	0.477	−0.031	0.067
Internal_S_Low		−0.006	0.250	0.982	−0.496	0.485
Internal_S_Mid		0.010	0.190	0.959	−0.362	0.382
Internal_S_High		0.030	0.187	0.873	−0.336	0.396
University_Low		−0.188	0.137	0.171	−0.457	0.081
University_Mid		−0.093	0.139	0.505	−0.366	0.180
University_High		0.235	0.172	0.172	−0.103	0.573
Public_Low		0.066	0.127	0.605	−0.183	0.314
Public_Mid		0.236	0.150	0.115	−0.058	0.530
Public_High		0.048	0.205	0.816	−0.355	0.450
RD_intensity	R&D exp to Turnover Ratio	0.002	0.002	0.39	−0.003	0.007
Turnover_GR	Turn Growth Rate—(%)	0.001	4.456 × 10⁻³	0.179	−2.74 × 10⁻⁴	0.001
Education_intensity	% LF undergr training or more	−0.012	0.031	0.695	−0.073	0.049
_IOcasio_act_i_1	Performing Innov Act Ocas	0.465	0.108	0.000	0.253	0.677
_IPersis_act_i_2	Performing Innov Act Pers	0.829	0.116	0.000	0.602	1.056
act_in_extl_know	R&D Act Ext Knowledge	0.221	0.084	0.008	0.056	0.385
_Ibarr_capi_1		0.323	0.140	0.021	0.049	0.597
_Ibarr_capi_2		0.007	0.143	0.962	−0.274	0.287
_Ibarr_capi_3		0.409	0.164	0.013	0.088	0.730
_Ibarr_capia1		−0.495	0.139	0.000	−0.767	−0.222
_Ibarr_capia2		−0.410	0.140	0.003	−0.685	−0.136
_Ibarr_capia3		−0.502	0.161	0.002	−0.816	−0.187
_Ibarr_inov_1		0.255	0.149	0.087	−0.037	0.547
_Ibarr_inov_2		0.261	0.146	0.074	−0.025	0.547
_Ibarr_inov_3		0.192	0.162	0.238	−0.126	0.510
_Ibarr_pess_1		0.030	0.151	0.845	−0.266	0.325
_Ibarr_pess_2		0.152	0.158	0.334	−0.157	0.462
_Ibarr_pess_3		0.387	0.186	0.038	0.021	0.752
_Ibarr_info_1		0.073	0.160	0.649	−0.241	0.386
_Ibarr_info_2		−0.027	0.184	0.883	−0.388	0.334
_Ibarr_info_3		−0.083	0.264	0.754	−0.601	0.435
_Ibarr_infoa1		−0.156	0.138	0.257	−0.426	0.114
_Ibarr_infoa2		−0.214	0.167	0.201	−0.543	0.114
_Ibarr_infoa3		−0.399	0.250	0.11	−0.888	0.091
_Ibarr_parc_1		0.179	0.127	0.158	−0.069	0.428
_Ibarr_parc_2		0.118	0.135	0.382	−0.147	0.383
_Ibarr_parc_3		0.414	0.169	0.014	0.083	0.744
_Ibarr_merc_1		−0.138	0.136	0.31	−0.404	0.128
_Ibarr_merc_2		0.017	0.135	0.90	−0.247	0.281
_Ibarr_merc_3		0.348	0.154	0.024	0.047	0.650
_Ibarr_ince_1		−0.335	0.134	0.013	−0.597	−0.072
_Ibarr_ince_2		−0.198	0.134	0.141	−0.461	0.065
_Ibarr_ince_3		−0.185	0.161	0.252	−0.501	0.132
_cons		−0.610	0.405	0.132	−1.404	0.184

Source: Author’s computation based on the panel constructed considering the CIS 6 and CIS 10
Note: Random effects probit regression N = 1839 responses from 1167 subjects; Wald test of H0: α = β = 0 has χ² ₅₁ = 160.63 (p-value < 0.001)

Appendix 2 1.1 Model 2: Determinants of the Abandon of the Innovative Activities Random Effects Probit Regression—Controlling by Sector

Variable	Estimate	SE	ρ-value	[95% Conf. Interval]
_Isize_3	0.034	0.098	0.727	−0.157	0.226
_Isize_4	0.135	0.116	0.246	−0.093	0.362
group	−0.098	0.095	0.300	−0.283	0.087
_Itech_inte_2	−0.060	0.118	0.610	−0.292	0.171
_Itech_inte_3	−0.027	0.114	0.815	−0.250	0.196
innov_general	−0.871	0.373	0.019	−1.602	−0.141
gastos_rd_total	7.76 × 10⁻⁹	7.05 × 10⁻⁹	0.271	−6.05 × 10⁻⁹	2.16 × 10⁻⁸
FUNDS_GEN.	0.061	0.088	0.488	−0.112	0.234
OPENNESS	0.019	0.025	0.453	−0.030	0.068
Internal_S_Low	5.95 × 10⁻⁴	0.251	1.000	−0.491	0.491
Internal_S_Mid	0.001	0.191	0.994	−0.372	0.375
Internal_S_High	0.028	0.187	0.883	−0.340	0.395
University_Low	−0.196	0.138	0.154	−0.466	0.074
University_Mid	−0.101	0.139	0.471	−0.374	0.173
University_High	0.227	0.173	0.189	−0.112	0.566
Public_Low	0.068	0.127	0.595	−0.181	0.316
Public_Mid	0.237	0.151	0.116	−0.058	0.532
Public_High	0.042	0.205	0.836	−0.360	0.445
RD_intensity	0.002	0.002	0.376	−0.003	0.007
Turnover_growth_rate	0.001	4.483 × 10⁻⁴	0.179	−2.763 × 10⁻⁴	0.001
Education_intensity	−0.009	0.032	0.782	−0.073	0.055
_IOcasional_act_i_1	0.468	0.108	0.000	0.255	0.680
_IPersistent_act_i_2	0.823	0.117	0.000	0.594	1.052
act_innov_external_know	0.223	0.084	0.008	0.059	0.388
_Ibarr_capi_1	0.331	0.140	0.018	0.057	0.605
_Ibarr_capi_2	0.013	0.143	0.928	−0.268	0.293
_Ibarr_capi_3	0.412	0.164	0.012	0.091	0.734
_Ibarr_capia1	−0.500	0.139	0.000	−0.771	−0.228
_Ibarr_capia2	−0.417	0.140	0.003	−0.691	−0.143
_Ibarr_capia3	−0.507	0.160	0.002	−0.821	−0.193
_Ibarr_inov_1	0.259	0.149	0.081	−0.032	0.551
_Ibarr_inov_2	0.262	0.146	0.073	−0.024	0.547
_Ibarr_inov_3	0.195	0.162	0.228	−0.122	0.513
_Ibarr_pess_1	0.031	0.151	0.835	−0.264	0.327
_Ibarr_pess_2	0.153	0.158	0.333	−0.156	0.462
_Ibarr_pess_3	0.378	0.186	0.043	0.012	0.743
_Ibarr_info_1	0.067	0.160	0.674	−0.247	0.382
_Ibarr_info_2	−0.029	0.184	0.874	−0.390	0.332
_Ibarr_info_3	−0.086	0.264	0.745	−0.603	0.432
_Ibarr_infoa1	−0.153	0.138	0.267	−0.424	0.118
_Ibarr_infoa2	−0.214	0.168	0.201	−0.543	0.114
_Ibarr_infoa3	−0.396	0.250	0.113	−0.885	0.094
_Ibarr_parc_1	0.178	0.127	0.16	−0.071	0.427
_Ibarr_parc_2	0.119	0.136	0.38	−0.147	0.385
_Ibarr_parc_3	0.415	0.169	0.014	0.084	0.747
_Ibarr_merc_1	−0.140	0.136	0.302	−0.406	0.126
_Ibarr_merc_2	0.015	0.135	0.909	−0.249	0.280
_Ibarr_merc_3	0.344	0.154	0.026	0.042	0.647
_Ibarr_ince_1	−0.333	0.134	0.013	−0.595	−0.070
_Ibarr_ince_2	−0.199	0.134	0.138	−0.463	0.064
_Ibarr_ince_3	−0.185	0.161	0.251	−0.501	0.131
_Isector_2	0.440	0.338	0.193	−0.222	1.103
_Isector_3	0.392	0.344	0.254	−0.281	1.066
_cons	−1.051	0.526	0.046	−2.081	−0.020

Source: Author’s computation based on the panel constructed considering the CIS 6 and CIS 10
Note: Random effects probit regression N = 1839 responses from 1167 subjects; Wald test of H0: α = β = 0 has χ² ₅₃ = 160.85 (p-value < 0.001)

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Costa, J., Botelho, A., Matias, J. (2018). Hindering Factors to Innovation: A Panel Data Analysis. In: Cubico, S., Favretto, G., Leitão, J., Cantner, U. (eds) Entrepreneurship and the Industry Life Cycle. Studies on Entrepreneurship, Structural Change and Industrial Dynamics. Springer, Cham. https://doi.org/10.1007/978-3-319-89336-5_12

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DOI: https://doi.org/10.1007/978-3-319-89336-5_12
Published: 28 June 2018
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Online ISBN: 978-3-319-89336-5
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Appendices

Appendix 1

1.1 Model 1: Determinants of the Abandon of the Innovative Activities Random Effects Probit Regression—General Model

Appendix 2

1.1 Model 2: Determinants of the Abandon of the Innovative Activities Random Effects Probit Regression—Controlling by Sector

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