Innovation Strategies and Productivity Growth in Developing Countries: Evidence from Pakistan
Waqar Wadho () and
No 466, GLO Discussion Paper Series from Global Labor Organization (GLO)
We examine the determinants of product, process, and organizational innovation, and their impact on firm labor productivity using data from a unique innovation survey of firms in Pakistan. We find significant heterogeneity in the impact of different innovations on labor productivity: Organizational innovation has the largest effect followed by process innovation. But unlike much of the literature, we found a negative impact of product innovation suggesting a disruption effect of new products; however, this is mitigated if new products are paired with process or organizational innovations. We find a strong impact of engaging in knowledge creation on product and process innovation. We found that external knowledge networks and innovation cooperation play no significant role in firms’ decision to perform R&D and its intensity, though vertical linkages with suppliers (clients) promote product (process) innovations. Foreign competition has a negative effect on product innovation and a positive effect on organizational innovation.
Keywords: Technological Innovation; organizational innovation; labor productivity; developing countries; Labor intensive industries (search for similar items in EconPapers)
JEL-codes: C24 C31 D22 L25 L67 O31 O32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-cse, nep-ino, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:glodps:466
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