Different influence of cooperation and public funding on innovation activities within German industries
Abstract
The aim of this research is to analyse (i) influence of cooperation with different partners and public funding on firms´ willingness to innovate; (ii) how public funding and cooperation with different partners influence firms´ innovation performance (turnover); (iii) effects of mutual interactions between firms´ innovation activities, cooperation with different partners and public funding on firms´ innovation performance (measured with turnover). The situation of 561 firms in Machines and Equipment industries in Germany was analysed because it is one of the most competitive economy in the world and one of the leaders in innovation within European Union. It allows to create unique benchmark and to propose implications that will be more appropriate and applicable also in other countries. For analyses, the data from Community Innovation Survey 2012-2014, which is a harmonized questionnaire and provides EU's science and technology statistics, was used, and new binary and multiple linear regression models were employed. Results of analyses show that provision of public subsidies, unlike cooperation, strongly influence firm’s motivation to innovate. However, results also showed that supported innovation activities do not always lead to an increase in firms´ innovative performance. Therefore, it can be pointed to the phenomenon of inefficiency of public innovation support in final consequence.
Keyword : cooperation, public funding, innovation activities, Germany, benchmark, CIS
How to Cite
Prokop, V., & Stejskal, J. (2019). Different influence of cooperation and public funding on innovation activities within German industries. Journal of Business Economics and Management, 20(2), 384-397. https://doi.org/10.3846/jbem.2019.9620
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
Ács, Z. J., Autio, E., & Szerb, L. (2014). National systems of entrepreneurship: Measurement issues and policy implications. Research Policy, 43(3), 476-494. https://doi.org/10.1016/j.respol.2013.08.016
Autio, E., & Fu, K. (2015). Economic and political institutions and entry into formal and informal entrepreneurship. Asia Pacific Journal of Management, 32(1), 67-94. https://doi.org/10.1007/s10490-014-9381-0
Bettencourt, L. M., Trancik, J. E., & Kaur, J. (2013). Determinants of the pace of global innovation in energy technologies. PLoS One, 8(10). https://doi.org/10.1371/journal.pone.0067864
Borradaile, G. J. (2013). Statistics of earth science data: their distribution in time, space and orientation. Springer Science & Business Media.
Borrás, S., & Edquist, C. (2013). The choice of innovation policy instruments. Technological Forecasting and Social Change, 80(8), 1513-1522. https://doi.org/10.1016/j.techfore.2013.03.002
Braunerhjelm, P., Ding, D., & Thulin, P. (2018). The knowledge spillover theory of intrapreneurship. Small business economics, 51(1), 1-30. https://doi.org/10.1007/s11187-017-9928-9
Broekel, T., Fornahl, D., & Morrison, A. (2015). Another cluster premium: Innovation subsidies and R&D collaboration networks. Research policy, 44(8), 1431-1444. https://doi.org/10.1016/j.respol.2015.05.002
Bronzini, R., & Piselli, P. (2016). The impact of R&D subsidies on firm innovation. Research Policy, 45(2), 442-457. https://doi.org/10.1016/j.respol.2015.10.008
Camisón, C., & Villar-López, A. (2014). Organizational innovation as an enabler of technological innovation capabilities and firm performance. Journal of Business Research, 67(1), 2891-2902. https://doi.org/10.1016/j.jbusres.2012.06.004
Carreira, C., & Lopes, L. (2018). Regional knowledge spillovers: a firm-based analysis of non-linear effects. Regional Studies, 52(7), 948-958. https://doi.org/10.1080/00343404.2017.1360484
Chatterjee, S., & Hadi, A. S. (2013). Regression analysis by example. John Wiley & Sons.
Claisse, F., & Delvenne, P. (2016). As above, so below? Narrative salience and side effects of national innovation systems. Critical Policy Studies, 11(3), 1-17. https://doi.org/10.1080/19460171.2015.1119051
Coad, A., & Rao, R. (2008). Innovation and firm growth in high-tech sectors: A quantile regression approach. Research policy, 37(4), 633-648. https://doi.org/10.1016/j.respol.2008.01.003
Coenen, L., Asheim, B., Bugge, M. M., & Herstad, S. J. (2017). Advancing regional innovation systems: What does evolutionary economic geography bring to the policy table?. Environment and Planning C: Politics and Space, 35(4), 600-620. https://doi.org/10.1177/0263774X16646583
Cooke, P. (2013). Qualitative analysis and comparison of firm and system incumbents in the new ICT global innovation network. European Planning Studies, 21(9), 1323-1340. https://doi.org/10.1080/09654313.2012.755828
Corrocher, N., & Cusmano, L. (2014). The “KIBS engine” of regional innovation systems: Empirical evidence from European regions. Regional Studies, 48(7), 1212-1226. https://doi.org/10.1080/00343404.2012.731045
Czarnitzki, D., & Lopes-Bento, C. (2014). Innovation subsidies: Does the funding source matter for innovation intensity and performance? Empirical evidence from Germany. Industry and Innovation, 21(5), 380-409. https://doi.org/10.1080/13662716.2014.973246
Dai, X., & Cheng, L. (2015). The effect of public subsidies on corporate R&D investment: An application of the generalized propensity score. Technological Forecasting and Social Change, 90, 410-419. https://doi.org/10.1016/j.techfore.2014.04.014
Doloreux, D., & Porto Gomez, I. (2017). A review of (almost) 20 years of regional innovation systems research. European Planning Studies, 25(3), 371-387. https://doi.org/10.1080/09654313.2016.1244516
Etzkowitz, H. (2003). Innovation in innovation: The triple helix of university-industry-government relations. Social Science Information, 42(3), 293-337. https://doi.org/10.1177/05390184030423002
Germany: STI Outlook. (2014). The innovation policy platform. Retrieved from https://www.innovationpolicyplatform.org/content/germany
Grilliches, Z. (1990). Patent statistics as economic indicators: a survey. Journal of Economic Literature, 28(4), 1661-1707.
Guerrero, M., Cunningham, J. A., & Urbano, D. (2015). Economic impact of entrepreneurial universities’ activities: An exploratory study of the United Kingdom. Research Policy, 44(3), 748-764. https://doi.org/10.1016/j.respol.2014.10.008
Gulbranson, C. A., & Audretsch, D. B. (2008). Proof of concept centers: accelerating the commercialization of university innovation. The Journal of Technology Transfer, 33(3), 249-258. https://doi.org/10.1007/s10961-008-9086-y
Guo, D., Guo, Y., & Jiang, K. (2016). Government-subsidized R&D and firm innovation: Evidence from China. Research policy, 45(6), 1129-1144. https://doi.org/10.1016/j.respol.2016.03.002
Hajek, P., & Henriques, R. (2017). Modelling innovation performance of European regions using multi-output neural networks. PloS One, 12(10). https://doi.org/10.1371/journal.pone.0185755
Hollanders, H., & Celikel-Esser, F. (2007). Measuring innovation efficiency. INNO Metrics.
Huggins, R., Izushi, H., Prokop, D., & Thompson, P. (2014). Regional evolution and waves of growth: A knowledge-based perspective. Expert Systems with Applications, 41(12), 5573-5586. https://doi.org/10.1016/j.eswa.2014.02.008
Intarakumnerd, P., Chairatana, P. A., & Tangchitpiboon, T. (2002). National innovation system in less successful developing countries: the case of Thailand. Research Policy, 31(8), 1445-1457. https://doi.org/10.1016/S0048-7333(02)00074-4
Leydesdorff, L., & Etzkowitz, H. (1998). Triple Helix of innovation. Science and Public Policy, 25(6), 358-364.
Lhuillery, S., & Pfister, E. (2009). R&D cooperation and failures in innovation projects: Empirical evidence from French CIS data. Research Policy, 38(1), 45-57. https://doi.org/10.1016/j.respol.2008.09.002
Lundvall, B. Å. (1992). National systems of innovation: Towards a theory of innovation and interactive learning. London: Pinter Publishers.
Merickova, B. M., Nemec, J., & Svidronova, M. (2015). Co-creation in local public services delivery innovation: Slovak experience. Lex Localis, 13(3), 521. https://doi.org/10.4335/13.3.521-535(2015)
Merickova, B., Prokop, V., & Stejskal, J. (2016). Consequences of enterprises’ cooperation within the innovation process – case study of the Czech Machinery Industry. E+M Ekonomie a Management, 19(3), 110-122. https://doi.org/10.15240/tul/001/2016-3-008
Niebuhr, A., & Peters, C. (2012). Labour diversity and firm’s innovation: Evidence from Germany. Nuremburg: IAB Institute for Employment Research.
Prochazka, O., & Hajek, P. (2015). Modelling knowledge management processes using fuzzy cognitive maps. In International Conference on Knowledge Management in Organizations (pp. 41-50). Springer International Publishing. https://doi.org/10.1007/978-3-319-21009-4_4
Prokop, V., & Stejskal, J. (2017). Different approaches to managing innovation activities: An analysis of strong, moderate, and modest innovators. Engineering Economics, 28(1), 47-55.
Prokop, V., Stejskal, J., & Hajek, P. (2018). The influence of financial sourcing and collaboration on innovative company performance: A comparison of Czech, Slovak, Estonian, Lithuanian, Romanian, Croatian, Slovenian, and Hungarian case studies. In Knowledge Spillovers in Regional Innovation Systems (pp. 219-252). Springer, Cham. https://doi.org/10.1007/978-3-319-67029-4_8
Raymond, L., & St-Pierre, J. (2010). R&D as a determinant of innovation in manufacturing SMEs: An attempt at empirical clarification. Technovation, 30(1), 48-56. https://doi.org/10.1016/j.technovation.2009.05.005
Retherford, R. D., & Choe, M. K. (2011). Statistical models for causal analysis. New York: John Wiley.
Robin, S., & Schubert, T. (2013). Cooperation with public research institutions and success in innovation: Evidence from France and Germany. Research Policy, 42(1), 149-166. https://doi.org/10.1016/j.respol.2012.06.002
Schneider, S., & Spieth, P. (2013). Business model innovation: Towards an integrated future research agenda. International Journal of Innovation Management, 17(01), 1340001. https://doi.org/10.1142/S136391961340001X
Spieth, P., Schneckenberg, D., & Ricart, J. E. (2014). Business model innovation–state of the art and future challenges for the field. R&D Management, 44(3), 237-247. https://doi.org/10.1111/radm.12071
StatSoft, Inc. (2011). STATISTICA (data analysis software system), version 10. Retrieved from www.statsoft.com
Tether, B. S. (2002). Who co-operates for innovation, and why: an empirical analysis. Research Policy, 31(6), 947-967. https://doi.org/10.1016/S0048-7333(01)00172-X
Van Beers, C., & Zand, F. (2014). R&D cooperation, partner diversity, and innovation performance: an empirical analysis. Journal of Product Innovation Management, 31(2), 292-312. https://doi.org/10.1111/jpim.12096
Wang, E. C., & Huang, W. (2007). Relative efficiency of R&D activities: A cross-country study accounting for environmental factors in the DEA approach. Research Policy, 36(2), 260-273. https://doi.org/10.1016/j.respol.2006.11.004
Zúñiga‐Vicente, J. Á., Alonso‐Borrego, C., Forcadell, F. J., & Galán, J. I. (2014). Assessing the effect of public subsidies on firm R&D investment: a survey. Journal of Economic Surveys, 28(1), 36-67. https://doi.org/10.1111/j.1467-6419.2012.00738.x
Autio, E., & Fu, K. (2015). Economic and political institutions and entry into formal and informal entrepreneurship. Asia Pacific Journal of Management, 32(1), 67-94. https://doi.org/10.1007/s10490-014-9381-0
Bettencourt, L. M., Trancik, J. E., & Kaur, J. (2013). Determinants of the pace of global innovation in energy technologies. PLoS One, 8(10). https://doi.org/10.1371/journal.pone.0067864
Borradaile, G. J. (2013). Statistics of earth science data: their distribution in time, space and orientation. Springer Science & Business Media.
Borrás, S., & Edquist, C. (2013). The choice of innovation policy instruments. Technological Forecasting and Social Change, 80(8), 1513-1522. https://doi.org/10.1016/j.techfore.2013.03.002
Braunerhjelm, P., Ding, D., & Thulin, P. (2018). The knowledge spillover theory of intrapreneurship. Small business economics, 51(1), 1-30. https://doi.org/10.1007/s11187-017-9928-9
Broekel, T., Fornahl, D., & Morrison, A. (2015). Another cluster premium: Innovation subsidies and R&D collaboration networks. Research policy, 44(8), 1431-1444. https://doi.org/10.1016/j.respol.2015.05.002
Bronzini, R., & Piselli, P. (2016). The impact of R&D subsidies on firm innovation. Research Policy, 45(2), 442-457. https://doi.org/10.1016/j.respol.2015.10.008
Camisón, C., & Villar-López, A. (2014). Organizational innovation as an enabler of technological innovation capabilities and firm performance. Journal of Business Research, 67(1), 2891-2902. https://doi.org/10.1016/j.jbusres.2012.06.004
Carreira, C., & Lopes, L. (2018). Regional knowledge spillovers: a firm-based analysis of non-linear effects. Regional Studies, 52(7), 948-958. https://doi.org/10.1080/00343404.2017.1360484
Chatterjee, S., & Hadi, A. S. (2013). Regression analysis by example. John Wiley & Sons.
Claisse, F., & Delvenne, P. (2016). As above, so below? Narrative salience and side effects of national innovation systems. Critical Policy Studies, 11(3), 1-17. https://doi.org/10.1080/19460171.2015.1119051
Coad, A., & Rao, R. (2008). Innovation and firm growth in high-tech sectors: A quantile regression approach. Research policy, 37(4), 633-648. https://doi.org/10.1016/j.respol.2008.01.003
Coenen, L., Asheim, B., Bugge, M. M., & Herstad, S. J. (2017). Advancing regional innovation systems: What does evolutionary economic geography bring to the policy table?. Environment and Planning C: Politics and Space, 35(4), 600-620. https://doi.org/10.1177/0263774X16646583
Cooke, P. (2013). Qualitative analysis and comparison of firm and system incumbents in the new ICT global innovation network. European Planning Studies, 21(9), 1323-1340. https://doi.org/10.1080/09654313.2012.755828
Corrocher, N., & Cusmano, L. (2014). The “KIBS engine” of regional innovation systems: Empirical evidence from European regions. Regional Studies, 48(7), 1212-1226. https://doi.org/10.1080/00343404.2012.731045
Czarnitzki, D., & Lopes-Bento, C. (2014). Innovation subsidies: Does the funding source matter for innovation intensity and performance? Empirical evidence from Germany. Industry and Innovation, 21(5), 380-409. https://doi.org/10.1080/13662716.2014.973246
Dai, X., & Cheng, L. (2015). The effect of public subsidies on corporate R&D investment: An application of the generalized propensity score. Technological Forecasting and Social Change, 90, 410-419. https://doi.org/10.1016/j.techfore.2014.04.014
Doloreux, D., & Porto Gomez, I. (2017). A review of (almost) 20 years of regional innovation systems research. European Planning Studies, 25(3), 371-387. https://doi.org/10.1080/09654313.2016.1244516
Etzkowitz, H. (2003). Innovation in innovation: The triple helix of university-industry-government relations. Social Science Information, 42(3), 293-337. https://doi.org/10.1177/05390184030423002
Germany: STI Outlook. (2014). The innovation policy platform. Retrieved from https://www.innovationpolicyplatform.org/content/germany
Grilliches, Z. (1990). Patent statistics as economic indicators: a survey. Journal of Economic Literature, 28(4), 1661-1707.
Guerrero, M., Cunningham, J. A., & Urbano, D. (2015). Economic impact of entrepreneurial universities’ activities: An exploratory study of the United Kingdom. Research Policy, 44(3), 748-764. https://doi.org/10.1016/j.respol.2014.10.008
Gulbranson, C. A., & Audretsch, D. B. (2008). Proof of concept centers: accelerating the commercialization of university innovation. The Journal of Technology Transfer, 33(3), 249-258. https://doi.org/10.1007/s10961-008-9086-y
Guo, D., Guo, Y., & Jiang, K. (2016). Government-subsidized R&D and firm innovation: Evidence from China. Research policy, 45(6), 1129-1144. https://doi.org/10.1016/j.respol.2016.03.002
Hajek, P., & Henriques, R. (2017). Modelling innovation performance of European regions using multi-output neural networks. PloS One, 12(10). https://doi.org/10.1371/journal.pone.0185755
Hollanders, H., & Celikel-Esser, F. (2007). Measuring innovation efficiency. INNO Metrics.
Huggins, R., Izushi, H., Prokop, D., & Thompson, P. (2014). Regional evolution and waves of growth: A knowledge-based perspective. Expert Systems with Applications, 41(12), 5573-5586. https://doi.org/10.1016/j.eswa.2014.02.008
Intarakumnerd, P., Chairatana, P. A., & Tangchitpiboon, T. (2002). National innovation system in less successful developing countries: the case of Thailand. Research Policy, 31(8), 1445-1457. https://doi.org/10.1016/S0048-7333(02)00074-4
Leydesdorff, L., & Etzkowitz, H. (1998). Triple Helix of innovation. Science and Public Policy, 25(6), 358-364.
Lhuillery, S., & Pfister, E. (2009). R&D cooperation and failures in innovation projects: Empirical evidence from French CIS data. Research Policy, 38(1), 45-57. https://doi.org/10.1016/j.respol.2008.09.002
Lundvall, B. Å. (1992). National systems of innovation: Towards a theory of innovation and interactive learning. London: Pinter Publishers.
Merickova, B. M., Nemec, J., & Svidronova, M. (2015). Co-creation in local public services delivery innovation: Slovak experience. Lex Localis, 13(3), 521. https://doi.org/10.4335/13.3.521-535(2015)
Merickova, B., Prokop, V., & Stejskal, J. (2016). Consequences of enterprises’ cooperation within the innovation process – case study of the Czech Machinery Industry. E+M Ekonomie a Management, 19(3), 110-122. https://doi.org/10.15240/tul/001/2016-3-008
Niebuhr, A., & Peters, C. (2012). Labour diversity and firm’s innovation: Evidence from Germany. Nuremburg: IAB Institute for Employment Research.
Prochazka, O., & Hajek, P. (2015). Modelling knowledge management processes using fuzzy cognitive maps. In International Conference on Knowledge Management in Organizations (pp. 41-50). Springer International Publishing. https://doi.org/10.1007/978-3-319-21009-4_4
Prokop, V., & Stejskal, J. (2017). Different approaches to managing innovation activities: An analysis of strong, moderate, and modest innovators. Engineering Economics, 28(1), 47-55.
Prokop, V., Stejskal, J., & Hajek, P. (2018). The influence of financial sourcing and collaboration on innovative company performance: A comparison of Czech, Slovak, Estonian, Lithuanian, Romanian, Croatian, Slovenian, and Hungarian case studies. In Knowledge Spillovers in Regional Innovation Systems (pp. 219-252). Springer, Cham. https://doi.org/10.1007/978-3-319-67029-4_8
Raymond, L., & St-Pierre, J. (2010). R&D as a determinant of innovation in manufacturing SMEs: An attempt at empirical clarification. Technovation, 30(1), 48-56. https://doi.org/10.1016/j.technovation.2009.05.005
Retherford, R. D., & Choe, M. K. (2011). Statistical models for causal analysis. New York: John Wiley.
Robin, S., & Schubert, T. (2013). Cooperation with public research institutions and success in innovation: Evidence from France and Germany. Research Policy, 42(1), 149-166. https://doi.org/10.1016/j.respol.2012.06.002
Schneider, S., & Spieth, P. (2013). Business model innovation: Towards an integrated future research agenda. International Journal of Innovation Management, 17(01), 1340001. https://doi.org/10.1142/S136391961340001X
Spieth, P., Schneckenberg, D., & Ricart, J. E. (2014). Business model innovation–state of the art and future challenges for the field. R&D Management, 44(3), 237-247. https://doi.org/10.1111/radm.12071
StatSoft, Inc. (2011). STATISTICA (data analysis software system), version 10. Retrieved from www.statsoft.com
Tether, B. S. (2002). Who co-operates for innovation, and why: an empirical analysis. Research Policy, 31(6), 947-967. https://doi.org/10.1016/S0048-7333(01)00172-X
Van Beers, C., & Zand, F. (2014). R&D cooperation, partner diversity, and innovation performance: an empirical analysis. Journal of Product Innovation Management, 31(2), 292-312. https://doi.org/10.1111/jpim.12096
Wang, E. C., & Huang, W. (2007). Relative efficiency of R&D activities: A cross-country study accounting for environmental factors in the DEA approach. Research Policy, 36(2), 260-273. https://doi.org/10.1016/j.respol.2006.11.004
Zúñiga‐Vicente, J. Á., Alonso‐Borrego, C., Forcadell, F. J., & Galán, J. I. (2014). Assessing the effect of public subsidies on firm R&D investment: a survey. Journal of Economic Surveys, 28(1), 36-67. https://doi.org/10.1111/j.1467-6419.2012.00738.x