Innovation and Performance: An Empirical Study of Russian Industrial Companies

Arkady Trachuk and Natalia Linder ()
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Arkady Trachuk: Department of Management, The Financial University, Under the Government of the Russian Federation, 15 Ulica Verhnjaja Maslovka, Moscow 127083, The Russian Federation
Natalia Linder: Department of Management, The Financial University, Under the Government of the Russian Federation, 15 Ulica Verhnjaja Maslovka, Moscow 127083, The Russian Federation

International Journal of Innovation and Technology Management (IJITM), 2018, vol. 15, issue 03, 1-22

Abstract: The paper investigates the relationship between investment in research and development (R&D), innovation expenses, and productivity of manufacturing companies. These empirical results have shown that innovation investments (1) improve the performance of industrial companies with the elasticity of 0.09; (2) innovation investment has an impact on the performance of the company, and the extent of this impact depends on the value of R&D investment and has a range of elasticity ranging from 0.03 (for low volumes of R&D investment) to 0.16 in high volumes of R&D investment; (3) the relationship between innovation investment and the growth of performance is nonlinear in nature and has a strong positive relationship only after a critical mass of innovation investment has been reached; (4) a significant role in the relationship of innovation investment and productivity is played by the features of the industry in which the company operates (the companies that operate in high-tech industries not only invest more in R&D and innovation but also have a better performance due to research and development); (5) companies of low-tech industries have a negative elasticity of innovation investment and productivity, which is due to the influence of unprofitable innovation investments (appropriability effect), i.e. additional profits from the investment are not significant.

Keywords: Innovation; the CDM model; R&D investment; company productivity; unprofitable innovation investment (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (10)

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DOI: 10.1142/S021987701850027X

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