The impact of Covid-19 and of the earlier crisis on firms’ innovation and growth: a comparative analysis

Anabela Santos (), Karel Haegeman and Pietro Moncada-Paternò-Castello
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Anabela Santos: European Commission - JRC, https://joint-research-centre.ec.europa.eu/index_en

No 2021-03, JRC Working Papers on Territorial Modelling and Analysis from Joint Research Centre

Abstract: Using the results of the Survey on the Access to Finance of Enterprises (2009 to 2020 editions), this paper aims to assess the effect of Covid-19 pandemic on the probabilities of firm to innovate and grow and to compare their likelihood with that of the previous downturn. To control for a possible endogeneity bias as part of innovation decisions a Recursive Bivariate Probit Model is used. Results show that the probabilities of firms to innovate and grow are lower in 2020 (Covid-19 crisis) than in 2009 (financial crisis). The economic performance of innovative firms was also affected by the pandemic, but considerably less than the performance of non-innovative ones. Changes in the innovation patterns are also observed. Possible implications for decision-makers are derived.

Keywords: Innovation; Growth; COVID-19; Europe. (search for similar items in EconPapers)
JEL-codes: O12 O31 O52 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2021-06
New Economics Papers: this item is included in nep-cfn, nep-cse, nep-ino, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ipt:termod:202103

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