|
on Economics of Strategic Management |
|
Issue of 2026–02–09
eleven papers chosen by João José de Matos Ferreira, Universidade da Beira Interior |
| By: | Faruk Hadžić (Sarajevo School of Science and Technology, Bosnia and Herzegovina); Ema Radončić (Sarajevo School of Science and Technology, Bosnia and Herzegovina) |
| Abstract: | This paper explores the relationship between the level of digital maturity and innovation of SMEs in Bosnia and Herzegovina, with a particular focus on the role of ICT as one of the drivers of innovation within the enterprise. Based on data collected from 304 enterprises from different sectors, a composite ICT index was created that quantifies the level of digital maturity of enterprises, as well as an innovation index that measures their activities in the field of innovation. Using descriptive statistics, sectoral segmentation, and K-means cluster analysis, the paper identifies significant differences in the level of digitalization between sectors, and also companies a positive relationship between a higher ICT index and greater innovation. The results show that enterprises with a higher level of digital maturity also achieve a higher level of innovation, while enterprises with a lower ICT index show a lower propensity to innovate. Based on the analysis, three clusters were formed that clearly distinguish enterprise profiles according to digital-innovation behavior. Furthermore, the findings of this research provide an empirical basis for the development of a targeted policy to support the digital transformation of sectoral SMEs, while identifying sectors with the lowest digital capacities as priorities for government intervention. The results obtained should be viewed with caution due to the subjectivity of the respondents' responses. As a practical suggestion, vouchers for digital tools and reskilling programs for the construction and hospitality sectors could accelerate the digital literacy of these companies. The paper aims to contribute to the understanding of the relationship between digital technologies and the innovation capabilities of enterprises in a transitional economic context. |
| Keywords: | Digital maturity, ICT index, Innovation, SMEs, Cluster analysis, Small and medium-sized enterprises |
| JEL: | O33 L26 M15 |
| Date: | 2025–12–15 |
| URL: | https://d.repec.org/n?u=RePEc:aoh:conpro:2025:i:6:p:166-179 |
| By: | Amira El-Shal (Cairo University); Eman Moustafa (African Export-Import Bank) |
| Abstract: | This study examines the relationships between gender, research and development (R&D), innovation, and productivity in Egyptian firms, leveraging panel data from 2013, 2016, and 2020. We explore whether female-led firms exhibit differences in productivity and innovation compared to their male-led counterparts. Going beyond most prior investigations, we allow for endogenous selection in innovation by incorporating instrumental variables within generalized structural equation models. Contrary to earlier findings, our results reveal that female-led firms are more likely to invest in R&D and innovate. Moreover, we show that female-led firms are as productive as male-led firms, challenging any notion of lower productivity among female-headed firms. In examining the links between R&D, innovation, and productivity, we determine that innovative and younger firms are more productive. Additionally, factors such as R&D expenditure, younger age, foreign technology adoption, and formal training provision increase the likelihood of innovation. Finally, firms adopting foreign technology and those with access to finance are more likely to invest in R&D. |
| Date: | 2024–10–20 |
| URL: | https://d.repec.org/n?u=RePEc:erg:wpaper:1744 |
| By: | Vasilios Kanellopoulos |
| Abstract: | This paper examines a competition game whose key variables are the R&D efforts (e.g. R&D expenditures) and accumulated knowledge of firms located in a specific region. The most significant element of accumulated knowledge is knowledge spillovers. These are considered intra-industry as it is assumed that the firms operate within the same industry (i.e. similar types of firms) and competitors offer similar products. The present study identifies a Nash equilibrium based on firm cost minimisation. This is derived under the assumption that the firms under examination act rationally and are primarily concerned with achieving optimal outcomes - specifically, by minimising their total costs. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.13282 |
| By: | Wided Mattoussi (University of TunisAuthor-Name: Younes Ben Zaied; EDC Paris Business School, Paris); Omar Al Tabaa (Leeds University Business School); Foued Mattoussi (University of Jendouba) |
| Abstract: | Foreign Direct Investment (FDI) can inject technology and knowledge into host- country economies, potentially influencing their firms' R&D investments and export capacities; as a result, these firms may engage in R&D (exports), potentially shaping the interaction between the two strategies. This paper investigates whether and when these strategies are complementary and reinforce each other, or whether they are substitutes, and should not be jointly pursued, as well as how combining the two strategies may lead to synergies positively affecting growth. The analysis was conducted on four clusters of firms using panel data of Tunisian manufacturing firms over the period 2016-2018. The first and second clusters include any exporting firms (differentiating exporters from non-exporters) without and with foreign participation, respectively. The third and fourth clusters are made up of fully exporting firms without and with foreign involvement, respectively. The findings suggest that R&D and exports positively reinforce each other in a dynamic virtuous circle to boost exports for firms with no foreign participation, whereas substitutability effects emerge for R&D activity, primarily for firms with foreign participation. The findings are also consistent with complementarities between the two activities in boosting the growth of fully exporting firms with foreign ownership.Length: 55 |
| Date: | 2024–12–20 |
| URL: | https://d.repec.org/n?u=RePEc:erg:wpaper:1770 |
| By: | Ahmed Chafai (University of Manouba); Rym Oueslati (University of Tunis); Hatem Salah (University of Manouba) |
| Abstract: | The objective of this study is to explore the curvilinear relationship between innovation and sustainable firm growth, as well as the moderating role of bank funding on research and development (R&D), institutional quality and bank market power on this nexus. To do this, we selected a sample of 424 companies listed in ten Arab countries (Bahrain, Egypt, Jordan, Kuwait, Morocco, Oman, Qatar, Saudi Arabia, Tunisia, and the United Arab Emirates) over the period 2010-2022. Using a systemic GMM model, the results show that there is a curvilinear (inverted U-shaped) link between innovation and sustainable firm growth. In addition, the outcome shows that bank funding on R&D, institutional quality and bank market power moderate the curvilinear nexus between innovation and sustainable firm growth. This study offers valuable insights into strategic innovation planning and elaboration of important implications by highlighting the role of bank funding on R&D, institutional quality and the power of the banking market in promoting firm sustainability. |
| Date: | 2025–12–20 |
| URL: | https://d.repec.org/n?u=RePEc:erg:wpaper:1819 |
| By: | Tomohiko INUI; YoungGak KIM; Hyeog Ug KWON |
| Abstract: | This paper examines how artificial intelligence (AI) development is related to firm productivity and business dynamism in Japan. Using firm-level panel data from the Basic Survey of Japanese Business Structure and Activities matched with the Institute of Intellectual Property (IIP) patent database, we use AI-related patent applications as a proxy for AI development and analyze its association with productivity, firm organization, and industry-level reallocation. The empirical analysis combines fixed-effects estimation, event-study methods, and inverse probability weighting to address potential endogeneity. We find that firms engaging in AI development tend to exhibit higher productivity in the medium to long run, while displaying distinctive dynamics around the timing of AI development. In particular, productivity temporarily declines around the onset of AI development and subsequently improves. This pattern is consistent with adjustment costs associated with the adoption of new general-purpose technologies, but it is also compatible with endogenous selection into AI development, and therefore, the analysis does not make strong causal claims. Importantly, the association between AI development and productivity is heterogeneous across firms. The positive relationship is more pronounced among firms with higher initial productivity levels and larger firm size, while it is weaker among smaller and lower-productivity firms, highlighting the role of complementary assets such as skilled labor and organizational capabilities. We further show that AI development is associated with changes in firm organization and labor composition. While total employment does not decline significantly, the share of high-skilled workers increases, and the number of subsidiaries tends to decrease. At the industry level, greater AI development is associated with stronger reallocation toward more productive firms, linking AI development to business dynamism in the Japanese economy. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:eti:rdpsjp:26004 |
| By: | Gu, Grace (University of California, Santa Cruz); Mulalic, Ismir (Department of Economics, Copenhagen Business School); Pozzoli, Dario (Department of Economics, Copenhagen Business School); Wu, Jinhong (The Technical University of Denmark) |
| Abstract: | Climate-related risks have increased significantly over the past two decades, including both physical risks (such as extreme weather events) and transition risks (arising from climate change mitigation policies). This paper examines how these risks relate to firms’ innovation outcomes, including those related to green technologies. We first develop a model in which firms choose how many workers to employ for R&D and production activities in response to rising climate risks. The model predicts an increase in green innovation and overall innovation under certain conditions. Empirical evidence from Danish administrative data generally supports these predictions, showing that firms exposed to climate risks exhibit higher innovation activity, especially in green technologies. |
| Keywords: | Climate change; Physical risks; Transition risks; Firms’ innovation |
| JEL: | Q54 Q55 Q56 |
| Date: | 2026–01–23 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:cbsnow:2026_003 |
| By: | Marco Bellandi; Maria Chiara Cecchetti; Caterina Orlando |
| Abstract: | This Handbook presents a database of selected cases and good practices on Circular Economy (CE) for Small and Medium-sized Enterprises (SMEs). Developed within the HEADCET project, it constitutes a valuable tool for supporting Higher Education Institutions and policymakers in addressing sustainable development challenges in Latin America and the Caribbean (LAC). Specifically, it provides: a concise review of the CE literature; an analytical framework of indicators for evaluating CE initiatives; literature-based SME case studies adopting CE practices in LAC; empirical case studies derived from a project survey involving SMEs, social enterprises, and business organisations; and good practices identified from the survey and linked to the indicator framework. The Handbook combines conceptual and empirical insights to analyse and assess CE initiatives and innovations at the business level, offering an evidence-based resource to compare and disseminate CE experiences, supporting knowledge transfer and policy-oriented learning around multi-actor initiatives in support of sustainable local and regional development. |
| Keywords: | Circular Economy, Small-Medium Enterprises, Case Study, Latin America and Caribbean |
| JEL: | O44 Q56 R11 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:frz:wpaper:wp2026_03.rdf |
| By: | Andrijana Bojadjievska Danevska (Faculty of Economics and Administrative Sciences International Balkan University, Skopje, North Macedonia) |
| Abstract: | Purpose Innovation and human capital are considered the two main pillars of contemporary economic growth (Aiting et al., 2022). Additionally, certain scholars consider that human capital is an innovation engine (Acemoglu, 1996; Aghion and Howitt, 1998). However, the evidence from developing countries shows that the increased investment in human capital has not brought the corresponding innovation growth (Li and Nan, 2019). In this context, this paper investigates the path from human capital, through innovation inputs and processes to innovation outcomes, by utilizing data from the Digital Evolution Index (2025) for 125 countries over the timespan 2008-2023. More specifically, this research examines whether human development presented as the “state of human condition” and measured within the Digital Evolution Index, translates into higher levels of innovation inputs, processes, and finally innovation outcomes, i.e., technological and innovation outputs that reflect society’s digital progress. In this framework, human development is conceptualized as a set of socio-economic conditions that enable individuals and communities to adopt, adapt, and benefit from digital technologies. Design/methodology/approach Panel regressions, i.e., Fixed Effects and Random Effects models, were applied to control for unobserved country heterogeneity. The Hausman Test statistics with 1.87 and a p-value of 0.76 showed that Random Effects estimators are more consistent. Additionally, to complement the causal inference, a Random Forest Regressor was used in order to capture non-linear patterns and provide feature importance analysis. Also, to account for structural differences across development levels, income group classifications by the World Bank (low, lower–middle, upper–middle, high) were included as additional predictors in the Random Forest Model. In simple terms, to test whether the development stage modifies the path. This study uses a combination of econometrics with machine learning models in order to improve predictive accuracy, provide more accurate and robust predictions (Khan and Wyrwa, 2025). Findings Panel regression confirms that the improvements in human development (measured and presented as human condition) are significantly associated with greater innovation inputs, which in turn foster processes and eventually outcomes. In the preferred Random Effects model, human development, inputs, and processes are all positive and significant predictors of outcomes. The Random Forest model has a strong predictive performance (R2 > 0.70, MAE low relative to outcome scale). It was trained on 80% of the sample and tested on the remaining 20%. The feature importance analysis provides insights into the relative predictive power of each analyzed determinant, where both impurity–based and permutation importance (see Figure 1) confirm that: - Innovation processes emerge as by far the most influential predictor of innovation outcomes (accounting for the vast majority of predictive power, i.e., close to 1.0 in permutation importance) - State of human development contributes modestly (~0.20) - Innovation inputs are weaker (~0.07) - Income groups contribute modestly, with Lower-middle (~0.03) and Upper-middle (~0.01) income classifications adding small predictive value, while Low-income countries show negligible importance. In summary, these findings show that while structural development levels matter, actually the strength of processes rather than income group status per se that primarily explains the cross-country differences in innovation outcomes. Originality/value This research combines panel regression and machine learning to empirically trace the path from human development, through innovation inputs and processes to outcomes. Findings suggest that investments in human development and innovation inputs are necessary but insufficient unless supported by robust processes, i.e. “systems in place which can facilitate the development of innovative ideas and practices” (Chakravorti et al., 2025), that translate inputs into tangible outputs, measured through ICT Service Exports (%), ICT Goods Exports (% Total Goods Exports), Apps developed per person, Scientific and Technical Journal Articles etc. Figure 1: Permutation importance of Predictors for Innovation Outcomes (Random Forest) (Source: Authors’ calculation based on DEI 2025) Table 1: Panel Regression Results (Dep. variable: Innovation outcomes) Variable FE coef. (t) RE coef. (t) Human Development 0.311 (3.21)*** 0.320 (15.60)*** Inputs 0.101 (2.11)** 0.090 (4.33)*** Processes 0.147 (2.10)** 0.198 (7.69)*** Constant -0.705 (-0.21) -2.476 (-2.13)** R2 (overall) 0.602 0.630 No.obs 2000 2000 (Source: Authors’ calculation based on DEI 2025) As shown in Table 1, both models fit the data well, indicating that around 60% of the variation in innovation outcomes is explained by the included predictors. Human development is a significant predictor in both FE and RE models, which means that improvements in social readiness, i.e., education, health, and income levels, etc., are strongly associated with higher innovation outcomes. Inputs and processes also show positive and statistically significant effects, highlighting that R&D investments, financial resources, effective institutional and organizational mechanisms, such as digital adoption, collaborative networks, and policy support, are critical in translating human development into tangible innovation results. |
| Keywords: | Panel regression, Random forest, Digital evolution, Innovation outcomes, Human development |
| JEL: | O15 O31 O33 |
| Date: | 2025–12–15 |
| URL: | https://d.repec.org/n?u=RePEc:aoh:conpro:2025:i:6:p:313-315 |
| By: | Belso-Martinez, Jose Antonio; Díez-Vial, Isabel; Rodríguez-Pose, Andrés |
| Abstract: | This article examines the effect of formal and informal institutional settings and of the governance of inter-organizational relationships on innovation at the cluster level. The research primarily relies on quantitative methods, utilizing data obtained from a survey involving 115 firms and 12 in-depth interviews. Supplementary qualitative information from the interviews has also been incorporated into the analysis. The results support the hypothesis that innovative firms should consider not only the impact of different governance modes but also how these modes align with the existing local contexts. Failure to do so may result in firms becoming entrenched in the prevailing practices and products of a specific location. |
| Keywords: | firms; innovation; clusters; institutions; governance; inter-organizational relationships |
| JEL: | M20 O30 D83 |
| Date: | 2024–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:122118 |
| By: | Daron Acemoglu (MIT, Department of Economics); Ufuk Akcigit (University of Chicago - Department of Economics); Simon Johnson (MIT, Sloan School of Management) |
| Abstract: | This chapter presents a tractable framework for the study of technology adoption and diffusion in the context of economic development. Firms in countries behind the world technology frontier can rapidly adopt new techniques from the world frontier. Lower absorptive capacity (because of weak education systems, poor management practices, or barriers to technology adoption), institutional distortions, mismatch between frontier technologies and the needs of firms in the country (i.e., “inappropriate technology†), and credit market frictions slow down technology adoption and cause the economy in question to have a greater distance to the frontier and thus lower income per capita—although the long-run growth rate of the country still remains equal to that of the frontier. This framework is extended to study the choice between innovation and imitation, as well as the role of selection for higher-productivity and higher-absorptive capacity firms during the process of economic development. We illustrate the main comparative statics of our framework with a number of correlations based on cross-country and firm-level data. The tractability of the framework makes it amenable to a range of additional extensions. |
| Keywords: | technology adoption, innovation, income gap, institutions, economic growth, development, productivity |
| JEL: | O1 O3 O4 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:bfi:wpaper:2026-12 |