How Do Young Innovative Companies Innovate?

Pellegrino, Gabriele; Piva, Mariacristina; Vivarelli, Marco

How Do Young Innovative Companies Innovate?

IZA Discussion Paper No. 4301

30 Pages Posted: 28 Jul 2009

See all articles by Gabriele Pellegrino

Gabriele Pellegrino

Catholic University of the Sacred Heart of Milan

Marco Vivarelli

Universita Cattolica del Sacro Cuore, Milano; IZA Institute of Labor Economics

Abstract

This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external R&D and at the acquisition of external technology in embodied and disembodied components. These input-output relationships are tested on a sample of innovative Italian firms. A sample-selection approach is applied. Results show that in-house R&D is linked to the propensity to introduce product innovation both in mature firms and YICs; however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while − in contrast with the incumbent firms − in-house R&D does not play a significant role.

Keywords: R&D, product innovation, embodied technical change, CIS 3, sample selection

JEL Classification: O31

Suggested Citation: Suggested Citation

Pellegrino, Gabriele and Piva, Mariacristina and Vivarelli, Marco, How Do Young Innovative Companies Innovate?. IZA Discussion Paper No. 4301. Available at SSRN: https://ssrn.com/abstract=1439154