Product and Process Innovation of Micro, Small and Medium Manufacturing Enterprises in Vietnam

  • Trang Thi Thu PhamEmail author
  • Nobuaki Matsunaga
Part of the Kobe University Monograph Series in Social Science Research book series (KUMSSSR)


Innovation promotion is relatively new to the Vietnamese society. It took several decades to develop the science, technology and innovation system and to gradually shift the science and technology strategy towards innovation. This chapter examines the factors driving product and process innovation of manufacturing micro, small and medium enterprises (MSMEs). We employ the SME surveys from 2005 to 2015—conducted every 2 years in ten cities and provinces—to create unbalanced panel data with 7399 observations and apply the probit model for the study. The findings suggest that firm experience in innovation and accumulated knowledge are crucial for future innovation; human capital of both entrepreneurs and employees (upper secondary and higher level education) and social capital are important for innovation; SMEs are apt to be more innovative given that they have higher capital intensity (production technology) or face intense competition; uncertainty of public policies and insufficient policy implementation are hindrance to innovation. Consequently, there is a need for improving the education and training system, including reinforcement of higher education, enhancing the inter-firm linkages and firm-research institute-university cooperation, and providing effective innovation incentives and support for enterprises.


Vietnam Probit model Panel data Product and process innovation SME 


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Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  1. 1.National Centre for Socio-Economic Information and Forecast, Ministry of Planning and InvestmentHanoiVietnam
  2. 2.Kobe UniversityKobeJapan

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