The effect of innovation on growth aspirations and internationalization in firms: Africa compared to the Protestant Europe

Abstract

The aim of the current study was to investigate if and how context accounts for differ- ences in the innovation, growth and export in African firms compared to firms in protestant Europe. Data extracted and recoded from a sample of firms in 20 countries (7 Protestant Europe and 13 African countries) participated in Global Entrepreneurship Monitor (GEM) surveys from 2001 to 2013 and this yielded a sample of 10981 firms. Analyses were done applying hierarchical linear modelling (HLM) due to the use of vari- ables in different levels of analysis (firm level and regional level). Interestingly, the re- sults showed that African firms don’t differ in terms of their innovation, growth and in- ternationalization level with the Protestant world but, if innovate, African companies expect less growth and internationalization from their innovation. Indeed, the results indicated that innovation exerts a significant positive influence on growth expectations and internationalization of the firms. The paper contributes to the existing literature by contextualizing the interplay of firm innovation, growth and internationalization. Keywords: Innovation, growth, export, internationalizatio