BIG data - BIG gains? Empirical evidence on the link between big data analytics and innovation

Thomas Niebel, Fabienne Rasel and Steffen Viete

No 17-053, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: This paper analyzes the relationship between firms' use of big data analytics and their innovative performance in terms of product innovations. Since big data technologies provide new data information practices, they create novel decision-making possibilities, which are widely believed to support firms' innovation process. Applying German firm-level data within a knowledge production function framework we find suggestive evidence that big data analytics is a relevant determinant for the likelihood of a firm becoming a product innovator as well as for the market success of product innovations. These results hold for the manufacturing as well as for the service sector but are contingent on firms' investment in IT-specific skills. Subsequent analyses suggest that firms in the manufacturing and service sector rely on different data sources and data-related firm practices in order to reap the benefits of big data. Overall, the results support the view that big data analytics have the potential to enable innovation.

Keywords: big data; data-driven decision-making; product innovation; firm-level data (search for similar items in EconPapers)
JEL-codes: D22 L20 O33 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-big, nep-cse, nep-ict, nep-ino, nep-pay and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:17053

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