UNU-MERIT: How firms innovate: R&D, non-R&D, and technology adoption

You may be interested in the following paper from UNU-MERIT by C. Huang, A. Arundel & H. Hollanders

The official abstract is below.

Non-R&D innovation is a common economic phenomenon, though R&D has been the central focus of policy making and scholarly research in the field of innovation. An analysis of the third European Community Innovation
Survey (CIS-3) results for 15 countries finds that almost half of innovative European firms did not perform R&D in-house. Firms with weak in-house innovative capabilities and which source information from suppliers and competitors tend to innovate through non-R&D activities.
In contrast, firms that engage in product innovation, find clients, universities and research institutions an important information source for innovation, or apply for patents or use other appropriation methods are more likely to perform R&D. However, non-R&D performers do not form a consistent block, with several notable differences between firms that use three different methods of innovating without performing R&D. Many of these determinants also influence the share of total innovation expenditures that are spent on non-R&D innovation activities. Furthermore, an analysis of the determinants of the share of each firm’s total innovation expenditures for non-R&D activities shows that the
factors that influence how innovation expenditures are distributed is generally consistent across sectors and European countries.

What I find interesting is that these empirical findings are very similar to what I have found in my interviews with South African firms. Many firms do a lot of innovation without spending any money on R & D. A large number of firms use specialised product developers (or freelance experts) to do research on their behalf. Or they depend on universities or technology stations for research. Amazingly, the majority of the firms doing product development (as their area of specialisation) are small firms.

I wish we had this kind of data in Africa…..


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