| dc.description.abstract | Innovation is considered a multi-level construct and it takes the form of (i) inputs and
(ii) outputs. Based on this, the thesis considers three inter-related questions in the form of three
essays: (1) What factors (firm, industry, institutional) affect innovation input choices and their
combinations at the firm level? (2) How do complementarities in innovation inputs impact firm
performance? and (3) How do complementarities in innovation outputs affect firm
performance?
The first essay explores the relationship between innovation input choices and their
determinants based on firm, industry, and institutional factors. The strategic choice of
innovation inputs by firms reflects the conditions under which make (R&D) and buy (purchase
of technology) alternatives are complements or substitutes. If firms choose to combine R&D
and purchased technology, the two are complements, but if the opposite happens, they are
perceived as substitutes. We take a step back and understand which elements affect these
innovation input choices by using factors rooted in RBV traditions and the TCE framework
both individually and in combination to analyze their impact on such innovation inputs. Using
the World Bank Enterprise Survey data of multiple developing and developed countries with
Multinomial Logistic Regression, we explore how heterogeneity in firm characteristics,
industry structures, and institutional regimes, along with their interactions, impact firms’
innovation input choices. We find, among other results that large firm size, availability of
credit, and combining favourable regulatory environment with large firm size increases the
likelihood of firms choosing to combine innovation inputs.The second essay investigates
complementarities-in-performance of innovation inputs This examination is necessitated as no
study explicitly looks at complementarities-in-performance of innovation inputs since all
inputs do not result in measurable outputs, and similarly, not all innovation outputs can be
traced back to such inputs. We conduct analyses with both the OLS and the Quantile
Regression methods along with supermodularity. Our main finding is that low-performing
firms tend to substitute R&D with External Technology Licensing rather than treat them as
complements when analyzed through supermodularity. The third question extends the literature
on complementarities-in-performance of innovation outputs and examines how investment in
new forms of complementary assets through marketing innovation combined with product and
process innovation impact firm performance using both OLS and Quantile Regression. Their
complementarity is confirmed through supermodularity. Here too, we find that low-performing
firms tend to treat the three forms of innovation as substitutes and not as complements. | en_US |
