The role of knowledge variety and intensity for regional innovation

This paper analyses the effect of variety and intensity of knowledge on the innovation of regions. Employing data for Swedish functional regions, the paper tests the role of the variety (related and unrelated) and intensity of (1) internal knowledge generated within the region and also (2) external knowledge networks flowing into the region in explaining regional innovation, as measured by patent applications. The empirical analysis provides robust evidence that both the variety and intensity of internal and external knowledge matter for regions’ innovation. When it comes to variety, related variety of knowledge plays a superior role.The earlier version of the paper was published in the following two working paper series: http://www.circle.lu.se/upload/CIRCLE/workingpapers/201334_Tavassoli_Carbonara.p df http://econ.geo.uu.nl/peeg/peeg1317.pdf</p

Innovation determinants over industry life cycle

This paper analyzes how the influence of firm-level innovation determinants varies over the industry life cycle. Two sets of determinants are distinguished: (1) determinants of a firm's innovation propensity, i.e. the likelihood of being innovative and (2) determinants of its innovation intensity, i.e. innovation sales. By combining the literature emphasizing firms' internal resources (micro-level) with the research strand on the role of the industry context (meso-level), the paper develops hypotheses about the relative importance of firm-level innovation determinants over the industry life cycle. Estimation of a firm-level model of innovation in Sweden, while acknowledging the stage of the life cycle of the industry a firm belongs to, shows that the importance of the determinants of innovation propensity and intensity is not equal over the stages of an industry's life cycle

Determinants and Effects of Innovation: Context Matters

Innovation and technological change is the major factor of production, renewal, and competitiveness of firms and nations in the contemporary “knowledge economy”. The overall purpose of this dissertation is to investigate the innovative behavior of firms in various sectors and regions. In particular, I have analyzed the determinants (driving forces) of firms’ innovation on the one hand (in paper 1 and 2), and the effect of firms’ innovation on the other hand (in paper 3 and 4). In addition, a central concern in this dissertation is that context, in which firms operate and innovate, matters for innovation. I take into account several contexts in the analyses of both the determinants and effects of innovation. These contexts are: the regions in which firms are located, the dynamics of industries, and the dynamics of cluster in which firms belong to. This dissertation consists of four separate papers plus an introductory chapter. Each paper can be read independently, but all of them deal with either determinants or effects of the innovation of firms. The first paper analyzes the effect of various firm-specific determinants on firms’ innovation output. It also considers the stages of the Industry Life Cycle (ILC) as a context in which firms operate and innovate. Using the Community Innovation Survey data for manufacturing and service sectors in Sweden during 2002-2004, I find that the importance of various determinants of firms’ innovation depends on the stages of the ILC in which they operate. The second paper is again investigates the determinants of innovation, but this time incorporates another context that affect the innovation, i.e. the regions that firms belong to. Using the patent applications data as a measure of innovation in all functional regions in Sweden during 2002-2007, we find that both the internal knowledge generated within the region and the inflow of external knowledge matter for innovation of firms located in the regions. Moreover, the extent of related variety of knowledge in the region has the superior role to promote innovation. The third paper examines the effect of a firm’s innovation output on firm’s performance. Export behavior of firms is chosen as a performance indicator. Particular attention is devoted to distinguishing between innovation input and innovation output and to isolate their effects on export behavior of firms. Using two waves of Swedish Community Innovation Survey data during 2002-2006 merged with registered firm-level data, I find that what really matters for enhancing the export behavior of firms is the innovation output of firms, rather than the innovation input (mere efforts in investing in innovation activities). The fourth paper also analyzes the effect of innovation on performance measures but this time incorporates another context, i.e. the life cycle of the regional cluster that firms belong to. This paper delves into a particular cluster, i.e. Linköping ICT cluster. Using data collected through interviews during 2009 and 2012 on key cluster actors, we find that innovation is among the factors that are always highly important at any given stage of the cluster’s evolution, however, it has slightly greater importance during the “growing” stage

Innovation strategies of firms : What strategies and why?

This paper analyzes various innovation strategies of firms. Using five waves of the Community Innovation Survey in Sweden, we have traced the innovative behavior of firms over a 10-year period, i.e. between 2002 and 2012. We distinguish between sixteen innovation strategies, which compose of Schumpeterian four types of innovations (process, product, marketing, and organizational) plus various combinations of these four types. First, we find that firms are not homogenous in choosing innovation strategies, instead, they have a wide range of preferences when it comes to innovation strategy and some of the innovation strategies are “commonly” used among firms. Second, using Transition Probability Matrix, we found that firms also persist to have such a diverse innovation strategy preferences. Finally, using Multinomial Logit model, we explained the determinant of each and every innovation strategies, while we gave special attention to the commonly used innovation strategies among firms

Survival of entrepreneurial firms : the role of agglomeration externalities

This paper analyzes the role of various types of agglomeration externalities on the survival rate of entrepreneurial firms. In particular, we trace the population cohort of newly-established and self-employed Swedish firms in the Knowledge-Intensive Business Service sector in 1997 up to 2012 and investigate the role of Marshallian and Jacobian externalities on the survival of these firms. We find that only Jacobian externalities (diversity) is positively associated with the survival of entrepreneurial firms. Not all Jacobian externalities matter though. Only the higher the ‘related variety’ of the region in which an entrepreneurial firm is founded, the higher will be the survival chance of the firm, while ‘unrelated variety’ barely has any significant correlation. The result is robust after controlling for extensive firm characteristics and individual characteristics of the founders. The main message here is: for a newly-established entrepreneurial firm, not only it matters who you are, but also where you are

Innovation strategies and firm performance : Simple or complex strategies?

This paper analyzes the effect of various innovation strategies (ISs) of firms on their future performance, captured by labor productivity. Using five waves of the Community Innovation Survey in Sweden, we have traced the innovative behavior of firms over a decade, that is, from 2002 to 2012. We defined ISs to be either simple or complex (in various degrees). We call an IS a simple IS when firms engage in only one of the four types of Schumpeterian innovations, that is, product, process, marketing, or organizational, while a complex IS is when firms simultaneously engage in more than one type. The main findings indicate that those firms that choose and afford to have complex ISs are better off in terms of their future productivity in comparison with those firms that choose not to innovative (base group) and also in comparison with those firms that choose simple ISs. The results are mostly robust for those complex innovators that have a higher degree of complexity and also keep the balance between technological (product and process) and non-technological (organizational and marketing) innovations

Persistence of various types of innovation analyzed and explained

This paper analyzes the persistency in innovation behavior of firms. Using five waves of the Community Innovation Survey in Sweden, we have traced the innovative behavior of firms over a ten-year period, i.e., between 2002 and 2012. We distinguish between four types of innovations: process, product, marketing, and organizational innovations. First, using transition probability matrix, we found evidence of (unconditional) state dependence in all types of innovation, with product innovators having the strongest persistent behavior. Second, using a dynamic probit model, we found evidence of "true" state dependency among all types of innovations, except marketing innovators. Once again, the strongest persistency was found for product innovators. (C) 2015 Elsevier B.V. All rights reserved