Scandinavian Working Papers in Economics

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

No 2017/11: The Role of Regional Context on Innovation Persistency of Firms

Sam Tavassoli () and Charlie Karlsson ()
Additional contact information
Sam Tavassoli: RMIT University, Postal: Australia
Charlie Karlsson: KTH, Postal: Sweden

Abstract: This paper analyses the role of regional context on innovation persistency of firms. Using five waves of the Community Innovation Survey in Sweden, we have traced firms’ innovative behaviour from 2002 to 2012, in terms of four Schumpeterian types of innovation: product, process, organizational, and marketing. Employing transition probability matrix and dynamic Probit model and controlling for an extensive set of firm-level characteristics, we find that certain regional characteristics matter for innovation persistency of firms. In particular, those firms located in regions with (i) thicker labour market or (ii) higher extent of knowledge spillover exhibit higher probability of being persistent innovators up to 14 percentage points. Such higher persistency is mostly pronounced for product innovators.

Keywords: location; innovation; persistence; product innovations; process innovations; market innovations; organizational innovations; firms; Community Inno¬vation Survey

JEL-codes: D22; L20; O31; O32

42 pages, August 6, 2017

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