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Does Cooperation Boost a Transition to a Higher Innovation Intensity in Firms?

Abstract:

The objective of this study is to determine the effect of R&D cooperation and non-R&D cooperation in the introduction of incremental and radical innovations. R&D cooperation tackles engineering, design, intellectual property, software development and database, and acquisition of tangible assets. Non-R&D cooperation is related to financing, training, and information. Using the National Survey of Innovation Activities of Ecuador 2009–2014, Tobit models are estimated to determine the effects of R&D and non-R&D cooperation on sales of non-innovative products, incremental innovations, and radical innovations are estimated. The control variables used in the model are firm’s size, economic sector, R&D expenditure, age, corporate group, and staff qualifications. The results show that R&D cooperation boosts a transition from selling non-innovative products to selling incremental and radical innovations. This happens by increasing the percentage of new products, for both firm and market, and decreasing the percentage of sales of non-innovative products. Interestingly, some variables such as labor qualification, age, and R&D expenditure behave differently depending on the novelty of products.