Scandinavian Working Papers in Economics

Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

No 392: Persistence of various types of innovation analysed and explained

Charlie Karlsson () and Sam Tavassoli ()
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Charlie Karlsson: Jönköping International Business School (JIBS), Blekinge Institute of Technology & Centre of Excellence for Science and Innovation Studies (CESIS)
Sam Tavassoli: Blekinge Institute of Technology

Abstract: This paper analyses the persistency in innovation behaviour of firms. Using five waves of the Community Innovation Survey in Sweden, we have traced the innovative behaviour of firms over a ten-year period, i.e. between 2002 and 2012. We distinguish between four types of innovations: process, product, marketing, and organizational innovations. First, using Transition Probability Matrix, we found evidence of (unconditional) state dependence in all types of innovation, with product innovators having the strongest persistent behaviour. Second, using a dynamic probit model, we found evidence of “true” state dependency among all types of innovations, except marketing innovators. Once again, the strongest persistency was found for product innovators.

Keywords: persistence; innovation; product innovations; process innovations; market innovations; organizational innovations; state dependence; heterogeneity; firms; Community Innovation Survey

JEL-codes: D22; L20; O31; O32

32 pages, January 16, 2015

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