Breadth of external knowledge search in service sectors

There is a dearth of empirical research on the impact of external knowledge search on innovation performance in different categories of service firms. This study explores the effectiveness of the breadth of external search on product and process innovations in German firms. In particular, we model a non-linear relationship between the breadth of knowledge and product and process innovations. Drawing on the Mannheim Innovation Panel (MIP) data for the German service firms in the period 2014-2016, we report findings from a bivariate probit model, which takes into account mutual interdependence between product and process innovations. Moreover, the model is separately estimated for knowledge-intensive business services (KIBS) and other services. For comparative purposes, we also estimate the model for manufacturing firms. Empirical findings uniformly show an inverted U-shaped effect of the breadth of knowledge on both product and process innovations. Furthermore, the results demonstrate that using up to three knowledge sources increases the probability of a joint implementation of product and process innovations. These findings hold for both KIBS firms and other services. However, those service firms that focus on a single type of innovation experience diminishing returns to external knowledge when exploiting more than one source of knowledge. These results suggest that a simultaneous introduction of different types of innovation requires diverse knowledge sources. In contrast, when focusing on a single type of innovation, service firms experience diminishing returns when using multiple sources. However, this finding is only partially found for manufacturing firms. Accordingly, our findings provide support for the demarcation approach, insofar as the breadth of knowledge has a heterogenous impact on innovation in manufacturing relative to service firms. Previous studies on the breadth of knowledge search mostly examined its influence on innovation performance without separately analysing manufacturing and service firms. The present study focuses on service firms, that are further divided into KIBS and other service firms. By investigating potentially non-linear relationships between knowledge breadth and product and process innovations, it illustrates how different innovation strategies are affected by a diverse pool of external knowledge sources

National and international R&D support programmes and technology scouting in European small and medium enterprises

This study evaluates the effectiveness of national and international R&D support programmes on firms' technology scouting, defined as firms' use of external knowledge sources. Drawing on a unique dataset on R&D support programmes for small and medium-sized enterprises (SMEs) operating in both manufacturing and service sectors across 28 European countries, this study reports treatment effects estimated by the copula-based endogenous switching model, which takes into account unobserved firm heterogeneity. Empirical results indicate that R&D support programmes have heterogeneous effects on technology scouting. In particular, a crowding out effect arises in the case of informal sources of external knowledge, while additional effects are reported for formal, strategic sources. For informal sources of external knowledge, a random distribution of R&D measures would have a substantially larger effect rather than using current selection criteria. This is among first study to explore the policy effects on technology scouting applying a copula-based endogenous switching model. Most cross-sectional empirical studies employ matching estimators, although their main disadvantage is the selection on observables

In-house R&D, external R&D and cooperation breadth in Spanish manufacturing firms: is there a synergistic effect on innovation outputs?

This study explores the nature of relationship between in-house R&D, external R&D and cooperation breadth and their joint impact on patent counts as well as technological, product and process, innovations in Spanish manufacturing firms. With regards to patent counts, empirical findings from a Generalised Method of Moments (GMM) estimator suggest a complementarity effect of internal and external R&D activities conditional on the breadth of R&D cooperation. Concerning technological innovation, results from dynamic random-effects probit models indicate no synergistic effects. In addition, we find evidence of persistence of all three innovation output measures. Our results suggest policy implications in relation to strengthening firms’ absorptive capacity that could have long-run effects

Regulatory barriers of internationalisation for the SMEs: an emerging market context

Purpose -The purpose of this paper is to identify, categorise and compare regulatory barriers of internationalisation for the SMEs from an emerging market context. Design/methodology/approach -Using primary data from a questionnaire survey, this paper has developed and validated a partial least square-based structural model to assess the key regulatory barriers of internationalisation with particular attention to the SMEs in Bangladesh. Findings -The results indicate that both administrative and economic regulatory barriers are significant for the internationalisation of SMEs where administrative regulatory barriers are slightly more substantial in Bangladesh. Originality/value –Internationalisation of SMEs has received increasing attention over recent decades, but the association between these two components (regulatory barriers and internationalisation of SMEs) is under explored particularly from emerging country context. By integrating findings from previous studies, this study provides further discussion from both theoretical and methodological aspects, and points out the directions for future research

Financial and Non-Financial Barriers to Innovation and the Degree of Radicalness

The aim of this study is to analyse the effects of barriers to innovation on firms’ propensity to engage in radical and incremental innovations. We look at innovative and potentially innovative firms and estimate the effect of three types of barriers—financial, knowledge and competition—on the propensity to radical innovation new to the world, radical innovation new to the market and incremental innovation. An empirical study has been performed, drawing on data collected from the German Mannheim Innovation Panel covering the period from 2014 to 2016. Empirical results reveal heterogeneous effects of barriers depending on the degree of radicalness. In particular, knowledge and competition barriers are an impediment to radical innovation, whereas financial and knowledge barriers reduce a probability of incremental innovation. Based on the findings, we discuss policy recommendations for mitigating barriers to innovation conditional on the degree of radicalness

Portfolio entrepreneurship in farming: Empirical evidence from the 1881 census for England and Wales

This paper examines portfolio entrepreneurs: those who operate more than one business at any one time. It focuses on the conditions that influence the occurrence of multiple businesses as compared with single business. Empirical evidence on the choice between portfolio entrepreneurship and a single occupation are scarce. In particular, most previous studies discuss the incidence of portfolio entrepreneurship without providing further insights into what influences the decision to engage in multiple activities. To fill this gap in the literature, our objective is to test empirically the factors that affect choice. Drawing for the first time from the historical resource of the 1881 census data for England andWales, we use a multi-level logit model to explore how employee size, farm size in acres, population density, age, gender, marital status, household size, the entrepreneurial ratio, and regional heterogeneity affect the probability of portfolio entrepreneurship. This historical resource allows a unique whole population analysis which offers opportunities, for the first time, to compare factors influencing portfolio choices between modern and past farming practices.This research was supported by ESRC grant ES/M010953 ‘Drivers of Entrepreneurship and Small Businesses’. Piloting of the research for 1881 was supported by Leverhulme Trust grant RG66385 ‘The long-term evolution of Small and Medium-Sized Enterprises (SMEs)’

Evaluating the effectiveness of public support on inbound open innovation: evidence from Spanish manufacturing SMEs

Applying several matching estimators to a sample of Spanish manufacturing SMEs, we evaluate the impact of regional and federal funding on inbound open innovation strategies. Such SMEs are more likely to respond to public support by increasing either their cooperation with government institutions or their investment in extramural R&D than by enhancing cooperative networks. A policy corollary is to promote measures to attenuate cooperation failures. Methodologically, each type of funding and each type of cooperative partner should be considered separately. Moreover, overestimation of treatment effects when firms' unobserved characteristics are not addressed suggests that sensitivity analysis should complement matching estimation