Complementarities in R&D and Innovation Decisions: An Enquiry on an Extensive Sample of Latin American Companies

Oliviero A. Carboni and Paolo Russu ()
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Oliviero A. Carboni: Department of Economics (DiSEA), University of Sassari and Centre for North South Economic Research (CRENoS), Via Muroni 25, Sassari 07100, Italy
Paolo Russu: Department of Economics (DiSEA), University of Sassari and Centre for North South Economic Research (CRENoS), Via Muroni 25, Sassari 07100, Italy

International Journal of Innovation and Technology Management (IJITM), 2024, vol. 21, issue 07, 1-26

Abstract: This study uses an extensive sample of company data referring to seven Latin American countries to analyze the potential influence of simultaneity and heterogeneity in determining decisions to commit to R&D and innovation outputs. First, the analysis focuses on the decisions about spending on in-house and external research. Second, the outcomes of three different innovations: process, product, and organizational. Choices were considered simultaneously by employing a multivariate probit estimation model. In so doing, the enquiry considered the possible systematic interdependencies among the decisions. The results indicate that the two R&D decisions are interdependent. However, a different picture emerged in relation to innovation outputs, in which the correlations coefficients were small with unexpected signs. This may indicate a structural weakness of the technological production system in Latin America, wherein the synergies, complementarities, and complex relationships usually involved in the process of innovation are not fully developed.

Keywords: R&D; innovation; applied econometrics; firm behavior; Latin America (search for similar items in EconPapers)
JEL-codes: C30 D20 L20 O30 O54 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1142/S0219877024500512

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