O31 - Innovation and Invention: Processes and IncentivesReturn

This paper examines the impact of fiscal policy on business investment in research and development (R&D). Panel regression models – with independent variables for the total tax and contribution rate, government appropriations and outlays for R&D, and the R&D tax subsidy rate – are set up to examine cross-country differences in business investment in R&D, with a set of control variables. The latter include, most notably, the number of full-time researchers, tertiary education attainment, the protection of intellectual property rights, governance, the long-term interest rate, and trade openness. The panel encompasses eleven countries of Central and Eastern Europe over ten years (2010–2019). The findings suggest that fiscal policy does not affect BERD, while trade openness, tertiary education attainment, and full-time researcher employment have a significant positive impact. These findings are consistent with some of the earlier studies on the effectiveness of fiscal policy in stimulating business investment, calling for greater allocation of public and private funds for R&D professional development and training programs.
Implications for Central European audience: This paper used recent data for eleven Central and Eastern European countries. Therefore, the findings are directly applicable to these countries. As the paper used random-effects generalised least squares estimation for panel data, the findings can be generalised to other countries.

Innovations are among the most important drivers of firms’ productivity improvement.  Newly introduced products and processes, as well as organizational and marketing practices, are important for firms’ performance and for countries’ prosperity. In this paper, we analyze how management processes influence firms’ innovation and performance based on Russian data. Our main research question is how the quality of management affects innovative results and thereby, productivity. We employ a survey of enterprise activities, and business climate BEEPS covering the period 2012-2014 and including 1564 firms. Based on the existing literature, we create a framework to study the impact of various factors on firms‘ innovation and productivity. We study both internal factors such as a firm’s quality of management and external factors such as innovation climate in the region and availability of private and public financing. A model applied in our research is a well-known CDM model containing three stages. This model makes it possible to analyze expenditures for research and development, implementation of innovations, and then its impact on the firm’s performance. Estimation results demonstrate that enterprises benefit from innovations. The same time, our research shows the importance of management quality in the firms’ innovative activities among the other internal and external factors affecting innovations. Results can be applied by the enterprises interested in innovations and by policymakers involved in facilitating innovations at the regional and country level.
Implications for Central European audience: A version of a well developed CDM model is used, which makes results reliable; the model can be further applied for the analysis of various economies, including the countries of Central Europe. Our research sheds light on the determinants of innovation activity at all its stages, creating a background for analysis and development of economic policy. A key implication is that management quality deserves attention along with other factors affecting firms’ innovation and productivity. The research is based on firm-level BEEPS data for Russia, making the possible comparison with the other countries covered by BEEPS survey.

Due to the increasing dynamics and complexity in the corporate environment, the importance of Corporate Entrepreneurship (CE) for the development and long-term sustainability of established companies’ competitive advantages is continuously increasing. However, the literature still lacks a CE framework that consolidates and integrates the different research findings illustrating the impact of particular CE drivers. We conduct a systematic literature review of the current CE research to ascertain which internal determinants promote CE in established organizations and how they nurture creativity and innovation. Building on a four-dimensional CE framework, we identify several central determinants of CE and provide practitioners in established organizations with guidelines for successful implementation of CE. By identifying several topical and outstanding issues, the paper encourages further debate and research activity.
Implications for Central European audience: This paper advanced the current CE research by systematically consolidating and integrating top management literature invoking multiple research streams and discussing several directions for further research. The developed framework reflects the current state of CE research and hence can serve as a guide for successful implementation of CE in established organizations, as well as for further investigation of the CE concept. Thus, this paper makes an important contribution to solving the puzzle of successful implementation of CE in established corporations.

The participation of national V4 electronic industry in global value chains is a source of additional output, in addition to, a driver of technological development and employment. The aim of the study is to analyse whether the V4 region has the expertise capacity to upgrade its position in the electronics GVC integrated into the Samsung company. The analysis is built on the theory of GVC and the methodology of surveying the V4 labour market and education related to engineering. The quantitative results are supplemented with research interviews with Samsung managers and related municipal leaders. The analysis concludes on V4 upgrading opportunities in electronics GVCs determined by expertise.

This article is devoted to comparative study of regional innovation development in Poland and Ukraine. Innovation potential and performance of Ukrainian regions assessment is grounded on the regional innovation systems approach, employing selected indicators of the EU regional innovation evaluation criteria. Key trends and problematic issues of regional innovation development are captured through a number of methods: comparative analysis, calculating variation of regional innovation capacity indicators within countries and their correlation versus per capita GDP of regions in Poland and Ukraine. The overall low level of R&D and innovation expenditure, high variation of regional innovation performance, insufficient effects of innovations on the regional GDP dynamics as well as lack of feasible policy instruments to support innovations constitute the main risks for the regional innovation systems considered. Weak and patchy regional innovation performance in both countries fosters import dependent managerial practices driven by foreign technology adoption.

This is a conceptual paper that focuses on the existence and support of entrepreneurial behavior and innovation in larger organizations. It first suggests why it is important to pay attention to entrepreneurship and innovation and then defines corporate entrepreneurship. Typical barriers of entrepreneurial activities are described as well as innovation dilemmas that organizations solve. The innovation process is not linear, but six components of innovative behavior may be identified, together with specific roles employees play when moving the idea forward from idea creation to implementation. Important factors influencing the success of entrepreneurial behavior are discussed, involving the role of middle managers and reward systems. Recommendations for fostering entrepreneurial behavior and innovation are provided together with a simple inventory for measuring employee perception of managerial and organizational support for innovation.