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Empirical analysis of innovation and productivity in services firms: The case of South Africa

Atoko Kasongo, Moses Sithole and Yasser Buchana

African Journal of Science, Technology, Innovation and Development, 2023, vol. 15, issue 1, 1-13

Abstract: The purpose of this paper is to investigate the impact of innovation on productivity in the services sector firms in South Africa. Using a three-stage econometric model we find that service sector firms are innovative. We show that firm size, public financial support, patent protection and market sources of information have a positive impact on the decision to innovate. The level of investment in innovation significantly influences the success of both technological and non-technological innovations in service sector firms. The results find that both technological and non-technological innovations have a positive impact on labour productivity, with a greater impact from non-technological innovation.

Date: 2023
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DOI: 10.1080/20421338.2021.2001207

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