TECHNOLOGICAL INNOVATION AND PRODUCTIVITY IN LATE-TRANSITION ESTONIA: ECONOMETRIC EVIDENCE FROM INNOVATION SURVEYS

Jaan Masso () and Priit Vahter

No 61, University of Tartu - Faculty of Economics and Business Administration Working Paper Series from Faculty of Economics and Business Administration, University of Tartu (Estonia)

Abstract: There is growing interest in modelling the relationship between innovation and productivity in developing and transition econo¬mies due to their attempts to establish knowledge-based economies and to increase business R&D. Our paper investigates whether there is a signi¬ficant relationship between technological innovation and pro¬ductivity in the manufacturing sector of Estonia. We use firm-level data for the analysis from two waves of Community Innovation Surveys (CIS3 and CIS4) from 1998–2000 and 2002–2004, which is then combined with financial data about firms from the Estonian Business Register in order to study the effect of innovation at higher leads. We apply a structural model that in¬volves a system of equations on innovation expenditure, inno¬vation outcome and productivity. Our results show that during 1998–2000 only product innovation increased productivity, while in 2002–2004 only process innovation had a positive effect on productivity. This can probably be explained by the different macroeconomic conditions in the two periods.

Keywords: productivity; innovation; Estonia (search for similar items in EconPapers)
JEL-codes: C31 O10 O31 O33 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2008
New Economics Papers: this item is included in nep-eff, nep-ino, nep-ipr, nep-pr~, nep-mic and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (67)

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Journal Article: Technological innovation and productivity in late-transition Estonia: econometric evidence from innovation surveys (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:mtk:febawb:61

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