Balancing Internal and External R&D Strategies to Improve Innovation and Financial Performance
Journal Title: BAR: Brazilian Administration Review - Year 2018, Vol 15, Issue 2
Abstract
This research investigated the complementarity of internal and external R&D for innovation development and the effect of innovation on the financial performance of European manufacturing firms. Using multigroup structural equation modeling, this study partially supported that internal and external R&D are complementary in firms from high-technology industries, whereas they are not in firms from low-technology industries. For the two groups of firms, both internal and external R&D separately had a positive effect on innovation performance. These results suggested that if low-tech firms, which had lower absorptive capacity than high-tech firms, want to improve their innovation performance in the long term, they should start prioritizing internal R&D to improve their absorptive capacity while achieving a short-term satisfactory innovation outcome. As absorptive capacity rises, more complex strategies balancing internal and external R&D should be adopted. Contrary to expectations, the empirical analysis indicated that innovation performance did not influence short-term financial performance for the whole sample. However, in countries more affected by the 2008 crisis (for instance, Baltic countries, Portugal and Spain), this effect was detected, indicating that innovation helped firms to recover faster.
Authors and Affiliations
Paula, Fábio de Oliveira; Silva, Jorge Ferreira da
Keywords
Related Articles
- EP ID EP40666
- DOI http://dx.doi.org/10.1590/1807-7692bar2018170129
- Views 257
- Downloads 0
A Study into the Impact of Logistics Sophistication of Brazilian Shippers in the Pattern of Contracting the Services of Logistics Operators
The main objective of this study is to evaluate the impact of the logistics sophistication of Brazilian shippers on the acquisition pattern of 3PL (third-party logistics) service providers. The conceptual model of logis...
Financial Disclosure and International Capital Mobility in Latin America
The extant literature provides evidence on the impact of financial disclosure environments on international capital mobility. However, to our knowledge, there are no such studies including Latin-American countries. We...
Reflections on Actor-Network Theory, Governance Networks, and Strategic Outcomes
In an attempt to instigate discussion in the areas of organizational studies and strategy, this essay focuses on themes related to Governance, Actor-Network Theory, and Strategic Outcomes. We seek to expand understandi...
The Relationship between Sentiment and Risk in Financial Markets
This article estimates association coefficients between measures of market sentiment and risk in the U.S., German and Chinese markets. In terms of risk, four measures were considered: standard deviation, value at risk,...
A Theoretical Essay on Sustainability and Environmentally Balanced Output Growth: Natural Capital, Constrained Depletion of Resources and Pollution Generation
The fact that today’s activities are imposing a heavy burden on the earth's capacity has led to an increasing interest in environmental issues. It is emphasized that rapid production growth has exhausted natural resourc...