scholarly journals Firm Characteristics, Financing and Firm Innovation in Africa

2021 ◽  
Vol 9 (7) ◽  
pp. 177-198
Author(s):  
Michael Asiedu
Keyword(s):  
New Technology ◽  
Capacity Utilization ◽  
Developed Countries ◽  
Structural Constraints ◽  
Firm Characteristics ◽  
African Countries ◽  
Firm Level ◽  
Firm Innovation ◽  
Funding Sources ◽  
Level Data

The study employed firm level data from the World Bank’s Enterprise Survey Indicator Database to investigate firm characteristics associated with firm innovation in 32 African countries, for the period 2009 to 2018. We find that firm level innovation, including the introduction of significantly new products (H1), new or significantly improved methods of manufacturing products (New Technology) are strongly associated with external funding sources (funds from Banks and non-banking institutions). In addition, firm level characteristics such as firm age, female ownership, capacity utilization, educated labor force, exposure to competition is strongly associated with firm innovation. These findings are very important for countries in Africa (and other less-developed countries) who spend less on research and development due financing and structural constraints but want to accelerate economic growth and increased productivity.

Access to finance and firm innovation

2018 ◽  
Vol 10 (1) ◽  
pp. 73-94 ◽  
Author(s):  
MccPowell Sali Fombang ◽  
Charles Komla Adjasi
Keyword(s):  
South Africa ◽  
Trade Credit ◽  
Microfinance Institutions ◽  
African Countries ◽  
Access To Finance ◽  
Firm Level ◽  
Firm Innovation ◽  
Content Type ◽  
Level Data ◽  
Firm Level Data

Purpose The study aims to examine the importance of access to finance in firm innovation by using firm-level data from the World Bank enterprise survey (WBES) on selected African countries. Design/methodology/approach This study utilises firm-level data from the WBES database and computes aggregate innovation index by using multiple correspondent analysis. The authors then apply instrumental variable models (to control for possible endogeneity between innovation and finance) to assess the link between finance and innovation. Findings The research finds that finance in the form of overdraft overwhelmingly drives innovation in all selected countries – Cameroon, Kenya, Morocco, Nigeria and South Africa. Trade credit enhances innovation among firms in Nigeria, South Africa and Cameroon, while asset finance drives innovation amongst firms in Cameroon, Nigeria and South Africa. Practical implications Policy incentives such as tax breaks could be put in place for financial intermediaries that have shown proof of extending loans to financially constraint firms to enable them to innovate. Furthermore, different financial institutions such as microfinance institutions can be supported to increase credit to enterprises. Partnerships with organisations willing to fund firms and support start-ups should be encouraged. One of such support mechanisms could be specialised schemes such as a credit guarantee scheme to encourage and secure lending to enterprises to promote innovation. Originality/value This paper provides empirical insights into how finance enhances innovation in African enterprises. It also shows how different finance structures (overdraft, asset finance and trade credit) affect firm innovation in different African countries.

Overcoming the Dark Side of Closed Networks in Cultural Tourism Clusters: The Importance of Diverse Networks

2017 ◽  
Vol 59 (3) ◽  
pp. 239-256 ◽  
Author(s):  
Ángela Martínez-Pérez ◽  
Marie-Michele Beauchesne
Keyword(s):  
Social Capital ◽  
Developed Countries ◽  
Cultural Tourism ◽  
Dark Side ◽  
Negative Effects ◽  
Firm Level ◽  
Firm Innovation ◽  
Closed Networks ◽  
The World ◽  
The Relationship

Despite the recognized importance of tourism as an engine of economic growth in developed countries, research on the antecedents of innovation in this sector has been sparse, especially in the context of tourism clusters. Scholars have suggested that social capital is a key determinant of firm innovation in the context of tourism clusters, but empirical evidence has been lacking. The aim of this article is to empirically study the interplay between social capital and innovation in the context of tourism clusters at firm level. More specifically, we analyzed the effects of closed networks and diverse networks on firm innovation using a sample of 215 hospitality and tourism firms located in the World Heritage Cities of Spain. Results showed an inverted-U-shaped relationship between closed networks and firm innovation. Consistent with existing literature, these findings suggest that whereas a certain degree of strength and density helps to promote innovation, a critical point may exist beyond which innovation stabilizes or deteriorates when the information of the network becomes too redundant. In addition, we found that diverse networks positively moderated the relationship between closed networks and firm innovation. In other words, structural holes appear to mitigate the negative effects arising from excess strength and density and encourage the development of innovations beyond what a firm relying solely on closed networks could achieve. In practice, these results suggest firms in tourism clusters should not exclusively focus on typical closed networks but also create connections with diverse agents to maximize their potential for innovation.

Pre-Entry Experience, Postentry Adaptations, and Internationalization in the African Mobile Telecommunications Industry

2021 ◽  
pp. 1-22
Author(s):  
Mohammad Jahanbakht ◽  
Romel Mostafa ◽  
Francisco Veloso
Keyword(s):  
Low Income ◽  
Telecommunications Industry ◽  
Mobile Telecommunications ◽  
African Countries ◽  
Firm Level ◽  
Operational Conditions ◽  
Adaptive Capabilities ◽  
Level Data ◽  
Start Ups ◽  
Mobile Telecommunications Industry

We study the evolution of the African mobile telecommunications industry from its effective beginning and explore the sources of ownership advantages among indigenous firms, by assembling historical qualitative and quantitative firm-level data. Our historical qualitative findings suggest that a few start-ups gained industry-specific knowledge through their pre-entry experience, directed their postentry development of capabilities toward adaptations to challenging market and operational conditions, and leveraged their adaptive capabilities to enter and compete in other African countries. Using our quantitative panel data, we show that these firms successfully internationalized across the continent. In particular, compared with other start-ups, they had higher rates of foreign entry in African countries that had relatively weaker rule of law, and greater market reach in African countries that had relatively larger low-income consumer segments. These patterns corroborate that their capabilities for overcoming the industry’s challenging market and operational conditions were their key ownership advantages. Through our triangulated analysis, we show that inherited industry knowledge provides a foundation for postentry capability development, and entrepreneurial leadership guides this process to create ownership advantages for regional internationalization.

scholarly journals A Taxonomy of Eco-Innovation Types in SMEs: Exploring Different Firm Profiles in the Canadian Wine Industry

2019 ◽  
Vol 11 (20) ◽  
pp. 5776 ◽  
Author(s):  
David Doloreux ◽  
Luisa Kraft
Keyword(s):  
Wine Industry ◽  
Firm Characteristics ◽  
Firm Level ◽  
Fully Integrated ◽  
Level Data ◽  
Firm Level Data ◽  
Innovation Strategies ◽  
Process Oriented

The paper examines eco-innovation strategies in the Canadian wine industry. It uses firm-level data of 151 wine firms that developed eco-innovations between 2015 and 2017 to build a taxonomy of four eco-innovation strategies: (i) eco-innovation laggers, (ii) product-oriented eco-innovators, (iii) process-oriented eco-innovators, and (iv) fully integrated eco-innovators. We then characterize these eco-innovation strategies with respect to firm-level innovation capabilities, firms’ knowledge openness, and firms’ specific characteristics. The results reveal heterogeneity in eco-innovation strategies and show that these strategies exhibit different configurations of innovation-related conditions and firm characteristics.

scholarly journals City economies and microbusiness growth

Urban Studies ◽  
2016 ◽  
Vol 54 (14) ◽  
pp. 3199-3217 ◽  
Author(s):  
Donald Houston ◽  
Darja Reuschke
Keyword(s):  
Employment Growth ◽  
Developed Countries ◽  
Business Owners ◽  
Firm Level ◽  
Urban Economic Development ◽  
Self Employment ◽  
Jobless Growth ◽  
Home Based ◽  
Level Data ◽  
Different Types

In developed countries, microbusinesses (those employing fewer than 10 people) and home-based businesses have been systematically overlooked in urban economic development thinking. This article assesses the influence of city location and being run from the business owner’s home on microbusiness growth, based on empirical analysis of panel firm-level data over a four-year period during the UK’s long boom. The analysis reveals that cities provide benefits to microbusinesses for turnover growth but not for employment growth – suggesting that the additional growth induced by cities for microbusinesses may be jobless growth. However, in the case of microbusinesses run from the owner’s home, cities facilitate growth into medium-sized businesses (with 50+ staff). In conclusion, microbusinesses, including those run from business owners’ homes, are integral to the evolution and dynamics of urban economies and essential to understanding the nature of growth in cities. Agglomeration theory needs to say more about how urban agglomeration benefits firms of different types and sizes, and small business and self-employment research needs to say more about the influence of location, in particular cities. How businesses use both commercial and residential property are integral to the nature of growth in cities.

Gender discrimination and firms’ profit: evidence from Brazil

2016 ◽  
Vol 43 (5) ◽  
pp. 801-814 ◽  
Author(s):  
Wenjun Liu ◽  
Tomokazu Nomura ◽  
Shoji Nishijima
Keyword(s):  
Labour Market ◽  
Gender Discrimination ◽  
Firm Characteristics ◽  
Firm Level ◽  
Productivity Shocks ◽  
Content Type ◽  
Discrimination Model ◽  
Level Data ◽  
Female Employees ◽  
Positive Effect

Purpose This paper investigates discrimination against women within the Brazilian labour market using firm-level data from the World Bank Investment Climate Survey. The purpose of this paper is to determine whether the female employees in the Brazilian labour market are paid less than their productivity warrants due to the existence of discrimination. Design/methodology/approach Based on employer discrimination model proposed by Becker (1971) that considered the proportion of female employees as a proxy for the extent of discrimination, the authors estimate the profit function using OLS analysis, and regress it on the proportion of female employees and other firm characteristics. To address the endogeneity problem caused by unobservable productivity shocks, the authors employed the methods proposed by Olley and Pakes (1996) and Levinsohn and Petrin (2003), respectively. Findings The results indicate that the proportion of female employees has positive effect on firms’ profit in 2002, but has no effect in 2007. This finding gives evidence of the existence of discrimination against female employees within the Brazilian labour market in the early 2000s, while the gender discrimination was reduced overtime. Originality/value This paper’s main contribution is to provide an approach that differs from that of previous research to determine whether discrimination exists within the Brazilian labour market. This paper also provides policy insights for Brazilian labour market.

scholarly journals Productivity Growth and Value Chains in Four European Countries

2020 ◽  
Vol 20 (18) ◽  
Author(s):  
Izabela Karpowicz ◽  
Nujin Suphaphiphat
Keyword(s):  
Productivity Growth ◽  
Global Financial Crisis ◽  
European Countries ◽  
Value Chains ◽  
Trade Integration ◽  
Firm Level ◽  
Firm Innovation ◽  
Level Data ◽  
Workforce Aging ◽  
The Global Financial Crisis

Advanced economies have been witnessing a pronounced slowdown of productivity growth since the global financial crisis that is accompanied in recent years by a withdrawal from trade integration processes. We study the determinants of productivity slowdown over the past two decades in four closely integrated European countries, Austria, Denmark, Germany and the Netherlands, based on firm-level data. Participation in global value chains appears to have affected productivity positively, including through its effect on TFP when facilitated by higher investment in intangible assets, a proxy for firm innovation. Other contributors to productivity growth in firms are workforce aging, access to finance, and skills mismatches.

Cooperation and novelty innovation: a study for Argentina

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Carolina Pasciaroni ◽  
Andrea Barbero
Keyword(s):  
Latin American ◽  
Developed Countries ◽  
Future Research ◽  
Firm Level ◽  
Firm Innovation ◽  
Industrial Firms ◽  
Content Type ◽  
Business Partners ◽  
Innovation Surveys ◽  
Partner Types

Purpose This paper aims to analyse the influence of cooperation on the degree of novelty of technological innovations introduced by industrial firms in Argentina. This influence is analysed from three perspectives: cooperation by partner type [business partners or scientific and technological centres (S&T) partners]; cooperation by number of partner types, from no cooperation to cooperation with two partner types; and cooperation by goals pursued by firms. Design/methodology/approach The data come from one of the last national innovation surveys conducted in Argentina. The study controls for endogeneity, using instrumental variable procedures within the conditional mixed-process (CMP) framework. Findings The main result is the influence of cooperation with universities and S&T centres on the introduction of more novel innovations, which was found both in estimations with and without endogeneity correction. This influence was verified for more complex goals (R&D, technology transfer and industrial design and engineering) as well as for less complex ones (tests and trials, human resources training, quality management and certification). Business cooperation seems to impact only on a lower degree of novelty for more complex goals. The increase in the number of partners that the firm cooperates with, from no cooperation to joint cooperation with two partner types, influences more novel innovations. Research limitations/implications Limitations and proposals for future research are discussed at the end of the study. Practical implications The results of this study contrast with the high propensity to cooperate with business partners shown by firms in Argentina and other Latin American countries. Therefore, this paper may help formulate more effective policies to promote cooperation conducive to firm innovation performance. Limitations and proposals for future research are discussed at the end of the study. Originality/value Although there is empirical evidence on this topic for developed countries, firm-level studies on cooperation and degree of novelty are scarce for Latin America. In addition, this paper analyses cooperation not only by type of partner but also by type of goal. This study attempted to control for endogeneity by using instrumental variables within the CMP framework.

scholarly journals COMPLEMENTARITIES OF R&D STRATEGIES ON INNOVATION PERFORMANCE: EVIDENCE FROM TAIWANESE MANUFACTURING FIRMS

2014 ◽  
Vol 19 (Supplement_1) ◽  
pp. S134-S156 ◽  
Author(s):  
Eric S. Lin ◽  
Yi-Chi Hsiao ◽  
Hui-lin Lin
Keyword(s):  
Developed Countries ◽  
Manufacturing Firms ◽  
Empirical Models ◽  
Combined Method ◽  
Firm Level ◽  
Data Set ◽  
Step Procedure ◽  
Level Data ◽  
Innovation Output ◽  
Consistent Estimators

This paper aims to empirically test the R&D complementarities among three alternative R&D strategies, namely, internal R&D, external R&D and cooperative R&D, under different measures of innovation output. Using a firm-level data set based on the Taiwanese innovation survey (in accordance with CIS 3) conducted in 2003, we are able to compare the R&D activities in this newly-industrialized country with other developed countries. Additionally, we apply a two-step procedure to reduce the endogeneity problem caused by the firms’ choices of strategies to obtain consistent estimators, which can be regarded as a combined method of adoption and productivity approaches. We show that the results of the estimation for R&D complementarities may be biased upwards or downwards if we do not include selection equations in the empirical models, thereby giving rise to endogeneity problems. Our empirical results generally support the existence of R&D complementarities, while the strength of complementary effects may vary across different measures of innovation output. Moreover, our finding suggests that the complementary relationship between external and cooperative R&D is fairly robust to various model specifications.

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