Transcript Constraints to innovation activities

Constraints to innovation
activities - evidence from Croatian
enterprises
Ljiljana Božić and Sonja Radas
The Institute of Economics, Zagreb
Introduction
• The studies on the influence of barriers to innovation
activities – e.g. Tiwari et al. (2007); Mohnen et al. (2008);
Canepa and Stoneman (2002); Hadjimanolis (1999);
Hyytinen and Toivanen (2005)
• Low level of innovativeness in Croatian enterprises
• 2004-2006: only 33.59% firms conducted innovation
activities (i.e. had R&D activities and/or introduced new
product innovation and/or process innovation of any type).
• Two thirds of firms did not make any effort to innovate
(calculation based on CIS4 data).
Research objectives
• The effects of constraining factors on the
decision to abandon or delay innovation project
in Croatian firms -potential and successful
innovators
• The effects of constraining factors on the
decision to abandon or delay innovation project
in respect to the structure of innovation portfolio
– successful innovators
Data
• Croatian Community Innovation Survey 4 (CIS4) 2004
to 2006
• Total sample: 3093 enterprises
• 1041 of potential and successful innovators.
• Firms that:
– reported development of product and/or process innovation,
– innovation activities that are not finished within three years
and/or
– invested in internal R&D, or any other activity related to
innovation development (such as expenditure in acquisition of
machinery or knowledge, expenditure on training, on market
introduction of innovation)
Method
• Probit model
Yi*= Xiβi + εi
1 if Yi* >0
Yi =
0 otherwise
Independent variables –
constraining factors
•
•
•
•
•
•
•
Lack of internal sources of finances
Lack of external sources of finances
Costs too high
Lack of qualified personnel
Lack of information on technology
Lack of information on markets
Problems with finding a partner for innovation
development
• Incumbent dominated market and
• Lack of demand
Descriptive statistics: constraining
factors
All
Lack of internal sources of
finances
Lack of external sources of
finances
Costs too high
Lack of qualified personnel
Lack of information on
technology
Lack of information on markets
Problems with finding cooperator
Incumbent dominated market
Lack of demand
No. of firms
%
Innovators
%
Abandoned Delayed
1846 59.68
838
80.50
235
188
1559 50.40
707
67.91
199
154
1745 56.42
1844 59.62
829
856
79.63
82.23
231
236
193
206
1688 54.57
794
76.27
231
201
1662 53.73
774
74.35
225
190
1380 44.62
624
59.94
188
171
1575 50,92
1532 49.53
726
715
69.74
68.68
217
208
171
169
The influence of constraining factors to the probability to
abandon and delay innovation development
Lack of internal sources of finances
Lack of external sources of finances
Costs too high
Lack of qualified personnel
Lack of information on technology
Lack of information on markets
Problems with finding co-operator
Incumbent dominated market
Lack of demand
Constant
Number of obs
LR chi2(9)
Prob > chi2
Log likelihood
Pseudo R2
Abandoning
0.158 *** (0.059)
-0.094 * (0.052)
0.043 (0.053)
0.017 (0.059)
0.172 ** (0.076)
-0.069 (0.073)
0.059 (0.052)
0.114 ** (0.053)
0.092 (0.060)
-1.394*** (0.115)
1041
65.04
0.0000
-549.274
0.0559
Delaying
-0.008 (0.061)
-0.095* (0.043)
0.060 (0.056)
0.187*** (0.060)
0.136** (0.078)
-0.027 (0.074)
0.192*** (0.053)
0.029 (0.054)
-0.009 (0.063)
-1.455*** (0.120)
1041
70.26
0.000
-503.0487
0.0653
Successful innovators – what
determines abandonments
Lack of internal sources of
finances
Lack of external sources of
finances
Costs too high
Lack of qualified personnel
Lack of information on
technology
Lack of information on markets
Problems with finding partner
Incumbent dominated market
Lack of demand
Intercept
Log likelihood
LR chi2 (9)
Prob > chi2
Pseudo R2
No of observations
New to the market
only
New to the firm
only
Both types
.422 * (.237)
.189 **(.099)
.163 (.131)
-.356 (.226)
-.155 * (.090)
-.137 (.104)
-.088 (.187)
-.156 (.236)
.149 * (.089)
.057 (.099)
.085 (.274)
-.020 (.136)
.159 (.240)
.292* (.179)
.153 (.207)
-.030 (.193)
-.138 (.134)
.085 (.089)
.116 (.092)
.068 (.108)
-1.351***(.377)
-1.313 *** (.211)
-47.294331
10.29
0.3273
0.0981
99
-185.7553
19.87
0.0187
0.0508
348
.015 (.123)
-.158 (.122)
.478
***(.152)
-.096 (.139)
.053 (.107)
.064 (.101)
.114 (.113)
-.967***
(.233)
-155.5092
21.97
0.0090
0.066
251
Successful innovators – what
determines delays
Lack of internal sources of
finances
Lack of external sources of
finances
Costs too high
Lack of qualified personnel
Lack of information on
technology
Lack of information on markets
Problems with finding partner
Incumbent dominated market
Lack of demand
Intercept
Log likelihood
LR chi2 (9)
Prob > chi2
Pseudo R2
No of observations
New to the market
only
New to the firm
only
Both types
-.068 (.221)
-.009 (.110)
.251* (.137)
.095 (.207)
-.164* (.099)
-.029 (.188)
-.048 (.258)
.186* (.099)
.195* (.106)
-.209**
(.106)
.042 (.128)
.141 (.128)
.066 (.302)
.224 (.143)
.060 (.150)
-.413 (.261)
.768***(.206)
-.066 (.218)
.067 (.192)
-1.253 (.387)
-41.083
22.72
0.0069
0.2166
99
.093 (.137)
.051 (.094)
-.057 (.097)
.027 (.117)
-1.739*** (.243)
-156.344
28.26
0.0009
0.0829
348
.047 (.141)
.210**(.108)
-.005 (.105)
.027 (.118)
-1.429 (.257)
-141.276
21.87
0.0093
0.0718
251
Main findings
• Different sensitivity to various constraining
factors when it comes to decision to abandon
and delay innovation development
• Constraints related to absorptive capacity
• Lack of qualified personnel
• Two factors are related to neither the probability
to abandon, nor to delay: lack of information on
market and lack of demand.
Next step…
• How firms innovate despite the problems?
Organisational
innovation
New design and pack.
New distribution
methods
Total R&D
Public funding
Cooperation
Part of the group
Continuous R&D
Presence on int. market
Size
Intercept
Lack of internal
finances
Lack of external
finances
Costs too high
Lack of qualified
personnel
Lack of information on
technology
Lack of inf. on markets
Problems with finding
partner
Incumbent dominated
market
Lack of demand
Intercept
Log likelihood
Wald chi2 (10)
Prob > chi2
Rho
Process
innovation
.746 ***
(.253)
.563** (.283)
Product
innovation
Product new to
the market
Product new to
the firm
-.186 (.220)
.005 (.194)
-.105 (.198)
.724***(.193)
.662***(.154)
.362**(161)
.113(.296)
.093 (.189)
.190 (.158)
.199 (169)
.081 (.074)
-.410 (.256)
-.020 (.244)
.757***(.293)
.001 (047)
.010 (.183)
.213 (.168)
.190 (.171)
-.067 (.043)
.075 (.159)
.420*** (.147)
-.202 (.151)
.705**(.368)
.021 (.368)
.572*(.328)
-1.171(1.120)
.337 (.208)
.295* (.165)
.316* (.173)
.091 (.216)
.293 (.738)
.180 (.162)
-.146 (.189)
-.241 (.659)
.013 (.043)
.046 (.164)
.076(.148)
.079(.153)
.538***
(.197)
.227 (.156)
.031 (192)
.207(.660)
.028 (.059)
.028 (.058)
.024 (.058)
.035 (.058)
-.057 (.053)
-.054 (.053)
-.062 (.052)
-.057 (.052)
.052 (.053)
.052 (.053)
.061 (.053)
.054 (.057)
.105* (.058)
.101* (.058)
.102* (.056)
.100* (.057)
.228***
(.078)
-.084 (.073)
.190***
(.051)
.079
(.053)
.028 (.061)
-1.172***
(.110)
-651.5978
27.88
.0019
.060
.221***
(.077)
-.073 (.074)
.183***
(.052)
.081
(.053)
.032 (.060)
-1.181***
(.110)
-733.9916
27.48
0.0022
-.273
.242***
(.075)
-.099 (.072)
.188***
(.050)
.072
(.052)
.040 (.060)
-1.168***
(.109)
-774.7764
38.70
0.00
.423
.247***
(.075)
-.074 (.073)
.163***
(.056)
.071
(.053)
.057 (.064)
-1.192***
(.109)
-765.3145
20.46
0.0252
-.439