Innovation and Firm Performance: An Empirical Investigation by Bettina Peters

By Bettina Peters

The technique of enterprises’ progress – when it comes to productiveness or employment – is a tremendous crisis of coverage makers. during this context, techniques are thought of to play a vital position in stimulating organisations’ functionality. This booklet investigates this normal speculation by way of taking a look at 3 themes: 1. Does innovation bring about a rise in employment progress? 2. Does innovation strengthen labour productiveness? three. Does innovation in a single interval increase innovation functionality in next sessions? in line with a finished innovation panel dataset for German organizations, this e-book offers distinct effects for every query, specifically through setting apart the consequences brought on by means of new items from these caused through the creation of recent construction applied sciences. From a theoretical viewpoint, among others, a brand new multi-product version has been built to review employment effects.

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Additional resources for Innovation and Firm Performance: An Empirical Investigation for German Firms

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To show this, a simple probit estimation has been performed. The binary indicator variable to innovate or not was regressed on industry dummies, firm size, a dummy variable for East Germany, and a dummy variable indicating an observation that stems from the non-response sample. Results are not shown here but are available upon request. 1 Mannheim Innovation Panel 21 suffered from the lack of a consensus on appropriate definitions and measuring concepts. Common to all definitions is the notion that something new is successfully introduced.

20 2 Data Set and Descriptive Analysis mation secret. In order to control for a response bias in the net sample, nonresponse analyses are carried out in Germany. Each year, a random sample of the non-participating firms is drawn and questioned on their core innovation indicators by telephone. The number of realised interviews varies between 2,000 and 4,000 each year. , 2005). The MIP differs from several other panel data sets with respect to the individual response pattern. That is, it is not a typical unbalanced panel for which information on individuals is available for a certain time period without gaps.

Additional employment effects may occur in upstream or downstream firms. If the firm acquires new machines to improve its production process, this directly stimulates labour demand in the corresponding supplier firm. Furthermore, if the innovative firm is able to increase its output, all its suppliers benefit and may boost their labour demand as well. On the other hand, competitors which cannot keep pace with the technological progress will lose market share or even disappear, implying a deterioration of jobs in those firms.

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