Exploring the impact of innovation on company performance in regions of intermediate development

Héctor López-Paredes (), Rosa M. Yagüe-Perales () and Isidre March-Chorda ()
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Héctor López-Paredes: Universidad Internacional del Ecuador
Rosa M. Yagüe-Perales: Universitat de València
Isidre March-Chorda: Universitat de València

Journal of Innovation and Entrepreneurship, 2025, vol. 14, issue 1, 1-26

Abstract: Abstract This study examines the relationship between the types of innovation applied by companies in the Valencian Community (Spain) and their performance, measured by the growth in the number of employees in the period 2014–2020. To achieve this objective, a simple and convenience survey was carried out with 113 active companies. The acquisition of information was focused on the types of innovation applied. Structural equation modeling (SEM) was applied to data processing and the respective associations and correlations between latent variables (types of innovation) were established. Among the most noteworthy results is that the implementation of strategic innovation, and the subsequent implementation of organizational innovation and marketing innovation cause growth in employment. While marketing innovation does not necessarily lead to the implementation of product and process innovations, and these, in turn, do not necessarily produce growth in employment. The findings confirm that implementing strategic innovation, followed by organizational and marketing innovation, leads to employment growth. This effect significantly depends on specific firm characteristics, including sector, size, age, and technological orientation.

Keywords: Structural equation models; Unemployment; Types of innovation; Valencian community; Moderating variables (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1186/s13731-025-00567-9

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