Subsidies, Enterprise Innovativeness and Sustainable Growth

Sabina Zampa and Štefan Bojnec ()
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Sabina Zampa: University of Primorska, Slovenia

from University of Primorska, Faculty of Management Koper

Abstract: This paper investigates associations between the subsidies, innovativeness, sustainable enterprise efficiency and growth. The focus of the study is on the subsidies for co-financing of purchases of new technological equipment with aim to increase enterprise innovativeness and production of new products. The analysis focuses only on the subsidies for co-financing of purchase of new technological equipment. This in-depth analysis of the three data sources from enterprise accounts, subsidies for technological equipment, and surveys in enterprises represent an important data management tool to evaluate achievement effects of subsidies as an important research, managerial and policy question. Subsidies can mislead enterprises that instead of improving efficiency they redirect attention to capture subsidies. The paper employs a combination of enterprise accountancy data, data on subsidies and unique in-depth enterprise level survey data. The analysis is conducted for the enterprises, which have received subsidies for innovation activities. The focus of the analysis is on the following four economic-financial indicators: total revenues, number of employees, profits and value-added per employee. The principal component analysis and multiple regression analysis are used to test the hypotheses related to the four economic-financial indicators and their comparisons. The principal component analysis revealed four components: supports for innovativeness, procedures and standards for innovation, innovation as condition, and the ways of innovation. The multiple regression analysis confirmed the positive association between innovativeness and enterprise efficiency.

Keywords: subsidies; enterprise innovativeness; economic-financial efficiency of enterprises; sustainable growth; Slovenia (search for similar items in EconPapers)
Date: 2015
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