Does Innovation Help the Good or the Poor Performing Firms?

LICOS Discussion Paper No. 230/2008

8 Pages Posted: 16 Mar 2009

See all articles by Jože P. Damijan

Jože P. Damijan

University of Ljubljana, Slovenia - Department of International Economics

Črt Kostevc

University of Ljubljana - Faculty of Economics

Matija Rojec

University of Ljubljana - Faculty of Social Sciences

Date Written: 2008

Abstract

Using firm-level innovation data for a large sample of Slovenian firms in the period 1996-2002, the paper finds surprising results that innovation is not benefitting all firms. We find that only manufacturing firms with below average productivity growth (the lowest four deciles) are likely to experience significant benefits from successful innovation, while faster growing firms do not extract any additional benefits from innovation. This evidence demonstrates how innovation can affect the observed convergence of firms in terms of productivity in the manufacturing sector.

Keywords: Research and development, innovation, knowledge spillovers, productivity growth

JEL Classification: D24

Suggested Citation

Damijan, Joze P. and Kostevc, Crt and Rojec, Matija, Does Innovation Help the Good or the Poor Performing Firms? (2008). LICOS Discussion Paper No. 230/2008. Available at SSRN: https://ssrn.com/abstract=1360666 or http://dx.doi.org/10.2139/ssrn.1360666

Joze P. Damijan (Contact Author)

University of Ljubljana, Slovenia - Department of International Economics ( email )

Kardeljeva ploscad 17
Ljubljana, 1000
Slovenia
+386 61 189 24 00 (Phone)
+386 61 189 26 98 (Fax)

Crt Kostevc

University of Ljubljana - Faculty of Economics ( email )

Kardeljeva ploscad 17
Ljubljana, 1000
Slovenia

Matija Rojec

University of Ljubljana - Faculty of Social Sciences ( email )

Kardeljeva ploscad 5
Ljubljana, 1000
Slovenia

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