Impact of Economic Crisis on Innovation Behaviour of Industrial Firms In Russia

MPRA Paper No. 43675, posted 9. January 2013

13 Pages Posted: 2 May 2013

See all articles by Boris Kuznetsov

Boris Kuznetsov

National Research University Higher School of Economics

Yuri Simachev

National Research University - Higher School of Economics; Russian Presidential Academy of National Economy and Public Administration

Date Written: December 30, 2010

Abstract

The paper focuses on empirical analysis of major factors that determine innovation activities of Russian manufacturing firms during the crisis.

We presume that the crisis has ambiguous effects on firms’ behaviour, on one hand limiting their financial capabilities to invest into new products and/or technologies, and on the other hand – creating additional incentives to innovate and opportunities to enter new markets.

We use micro-level data to reveal major determinants of changes in innovation activity of a firm, including structural characteristics (size, industry, etc.), competitive environment (intensity of competition and type of main competitors), changes in financial position of a firm, it’s pre-crisis performance and innovation activity, the declared strategy of a firm and other factors.

The empirical part of our research is based mostly on the results of two surveys of industrial firms conducted in August of 2008 (before the crisis) and in September 2009 (during the crisis). About 600 medium and large firms mostly in manufacturing industries have been surveyed using specially developed survey instruments. We show that while general impact of the crisis on innovation activity was strong and negative different industries have been damaged to different extent. The adjustment to the crisis led to sharp decrease in investment intensive innovations while R&D activity has diminished much less and for some groups of firms has even intensified. The drop in innovations is typical for firms pursuing the strategy of incremental improvements of technology and products or with the strategy of large-scale investments in enhancing the production of traditional goods, rather than for firms focused on the development of new products. We found further that about 30% of manufacturing firms during the crisis still pursued innovation based strategies and this behaviour does not is depend on industry or even financial position.

Keywords: Industrial innovation, Impact of crisis, Innovation policy

JEL Classification: D22, O31, O38

Suggested Citation

Kuznetsov, Boris and Simachev, Yuri, Impact of Economic Crisis on Innovation Behaviour of Industrial Firms In Russia (December 30, 2010). MPRA Paper No. 43675, posted 9. January 2013 , Available at SSRN: https://ssrn.com/abstract=2258499 or http://dx.doi.org/10.2139/ssrn.2258499

Boris Kuznetsov

National Research University Higher School of Economics ( email )

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

Yuri Simachev (Contact Author)

National Research University - Higher School of Economics ( email )

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia
+7 985 764 6865 (Phone)

HOME PAGE: http://https://www.hse.ru/en/org/persons/4579329

Russian Presidential Academy of National Economy and Public Administration ( email )

Varnadskogo Avenue,82
Sredny av. V.O., 57/43
Moscow, St. Petersburg 119571
Russia

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
53
Abstract Views
517
rank
500,163
PlumX Metrics