Scandinavian Working Papers in Economics

Papers in Innovation Studies,
Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy

No 2013/42: Innovation Determinants over Industry Life Cycle

Sam Tavassoli ()
Additional contact information
Sam Tavassoli: Industrial Economics, Blekinge Institute of Technology, Karlskrona, Sweden and CIRCLE, Lund University, Sweden, Postal: CIRCLE, Lund University, PO Box 117, SE-22100 Lund, Sweden

Abstract: This paper analyzes how the influence of firm-level innovation determinants varies over the industry life cycle. Two sets of determinants are distinguished: (1) determinants of a firm’s innovation propensity, i.e. the likelihood of being innovative and (2) determinants of its innovation intensity, i.e. innovation sales. By combining the literature emphasizing firms’ internal resources (micro level) with the research strand on the role of the industry context (meso-level), the paper develops hypotheses about the relative importance of firm-level innovation determinants over the industry life cycle. Estimation of a firm-level model of innovation in Sweden, while acknowledging the stage of the life cycle of the industry a firms belongs to, shows that the importance of the determinants of innovation propensity and intensity are not equal over the stages of an industry’s life cycle

Keywords: Determinants of innovation; innovation intensity; innovation propensity; Industry Life Cycle (ILC); Community Innovation Survey (CIS4)

JEL-codes: F14; O31; O33

34 pages, December 18, 2013

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