Firm Characteristics and Innovation Activity: A Study of Italian Family Firms

Murad Harasheh, Alessandro Capocchi and Andrea Amaduzzi

International Journal of Business and Management, 2021, vol. 13, issue 12, 180

Abstract: Increasingly, innovation is seen as a novel leverage tool with which to create business and social value and thereby place its finders and users at a competitive advantage. Contemporary research suggests that the determinants of the innovation activity of firms are numerous. In this paper, we consider the financial and governance characteristics that might influence the innovation activity of a sample of 700 family firms in Italy. Our study was conducted over a 10-year period, from 2007 to 2016, using panel analysis models alongside robustness tests for the lagging effect and the probability regression as well as diagnostic statistics to ensure the use of an appropriate model. The results show that the existence of institutional investors, as a proxy for governance, has a persistent positive relationship with patent value, as a proxy for innovation, but not with the likelihood of being innovative. Moreover, financial indicators such as net working capital, earnings before interest, taxes, depreciation, and amortization, debt, and equity are found to explain innovation activity better than other indicators in both the panel and probability regressions. We also find very little significant difference between the sectors and regions featured in the study, suggesting that the relationship among them is quasi-systematic. Concluding the paper, our findings are discussed in relation to their policy implications and suggestions for further research are made.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/ijbm/article/download/0/0/37453/37784 (application/pdf)
http://www.ccsenet.org/journal/index.php/ijbm/article/view/0/37453 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ibn:ijbmjn:v:13:y:2021:i:12:p:180

Access Statistics for this article

More articles in International Journal of Business and Management from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().