000149022 001__ 149022
000149022 005__ 20250124153131.0
000149022 0247_ $$2doi$$a10.1108/JSTPM-08-2020-0126
000149022 0248_ $$2sideral$$a124625
000149022 037__ $$aART-2022-124625
000149022 041__ $$aeng
000149022 100__ $$0(orcid)0000-0003-2114-5033$$aOrtiz Gómez, Francisco Javier$$uUniversidad de Zaragoza
000149022 245__ $$aWhy firms stop introducing innovations in the great recession: aggregate demand, financial constraints and risk.
000149022 260__ $$c2022
000149022 5203_ $$aWith Spanish Community Innovation Survey data, this paper tests two main hypotheses as explanation of the fall in business innovation output in the Great Recession: the aggregate demand effect (firms have lower propensity to initiate innovation projects in recession than in contraction from demand-pull and profit expectations effects) and the risk effect (a greater proportion of the initiated projects fail in recessions than in expansions).
The research methodology consists on first modelling the decision by firms to initiate innovation projects in t or not (probit model), and, second, modelling the outcomes, success or failure in t + 1 of firms that decide to initiate (Heckman model).
The empirical results support the two hypotheses. They also indicate that the sensitivity of the decision to initiate innovation projects to the aggregate demand is more pronounced among financially constrained firms than among unconstrained ones, while the risk effect appears to be independent of the financial situation of firms.
The results of the research are limited by not being able to follow up individual innovation projects, and by not having available a more representative sample of firms where non-innovators and potential innovators are represented (now is biased toward potential innovators).
The results highlight the importance of macroeconomic stability for sustained business innovation output over time and calls managers’ attention in better management of innovation risk.
The results of the paper recommend macroeconomic polies aimed at the stabilization of aggregate demand and smoothing the business cycle, as a way to contribute to the stabilization of the growth of innovation output over time. Monetary and fiscal policies that smooth the business cycle will then have significant effects in the stabilization of innovation output and, in turn, in the reduction of volatility of economic growth over time. Increasing the direct public financial aid to undertake innovation projects in recession periods will not have the same innovation output stabilization effect than the stabilization of the aggregate demand. The reason is that, as the paper points out, the innovation output of financially unconstrained firms is also affected negatively by the contraction of aggregate demand in recession periods.
This paper is the first one to investigate the differences in business innovation outputs in expansions and recessions, separating the aggregate demand and the risk effect that the organisation for economic co-operation and development identifies as main determinants of the fall in innovation output during the Great Recession. The decomposition of firms’ innovation output in the decision to initiate innovation projects and the likelihood that those initiated succeed is also new in the literature.
000149022 536__ $$9info:eu-repo/grantAgreement/ES/DGA-FEDER/S42-20R-CREVALOR$$9info:eu-repo/grantAgreement/ES/MINECO/ECO2017-86305-C4
000149022 540__ $$9info:eu-repo/semantics/closedAccess$$aAll rights reserved$$uhttp://www.europeana.eu/rights/rr-f/
000149022 592__ $$a0.647$$b2022
000149022 593__ $$aIndustrial Relations$$c2022$$dQ2
000149022 593__ $$aStrategy and Management$$c2022$$dQ2
000149022 593__ $$aManagement Science and Operations Research$$c2022$$dQ2
000149022 593__ $$aManagement of Technology and Innovation$$c2022$$dQ2
000149022 594__ $$a6.6$$b2022
000149022 655_4 $$ainfo:eu-repo/semantics/article$$vinfo:eu-repo/semantics/publishedVersion
000149022 700__ $$0(orcid)0000-0001-8405-1056$$aSalas Fumás, Vicente$$uUniversidad de Zaragoza
000149022 7102_ $$14012$$2650$$aUniversidad de Zaragoza$$bDpto. Direcc.Organiza.Empresas$$cÁrea Organización de Empresas
000149022 773__ $$g13, 4 (2022), 869-897$$tJournal of Science and Technology Policy Management$$x2053-4639
000149022 8564_ $$s365999$$uhttps://zaguan.unizar.es/record/149022/files/texto_completo.pdf$$yVersión publicada
000149022 8564_ $$s2025662$$uhttps://zaguan.unizar.es/record/149022/files/texto_completo.jpg?subformat=icon$$xicon$$yVersión publicada
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000149022 951__ $$a2025-01-24-14:49:11
000149022 980__ $$aARTICLE