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Innovation and firm-level persistent profitability: a Schumpeterian framework

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  • Peter W Roberts

    (Columbia Business School, Columbia University, New York, NY, USA)

Abstract

Studies of firm-level profit dynamics tend to attribute the variance in profit persistence to variability in the extent to which imitative pressures are resisted. This monopoly-based explanation of persistent profitability implicitly assumes a one-to-one correspondence between firm-level and product-level profit dynamics. Following Schumpeter, this paper begins to develop a framework for firm-level profit persistence that embraces product innovation, competitor imitation, and, more importantly, the prospect that several product innovations may be embodied within a single firm. Such an approach opens the door for an innovation-based explanation of profit persistence to accompany the monopoly-based arguments that are typically offered. Copyright © 2001 John Wiley & Sons, Ltd.

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  • Peter W Roberts, 2001. "Innovation and firm-level persistent profitability: a Schumpeterian framework," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 22(4-5), pages 239-250.
    • Handle: RePEc:wly:mgtdec:v:22:y:2001:i:4-5:p:239-250
    DOI: 10.1002/mde.1018
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    Cited by:

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    3. Stoneman, Paul, 2011. "Soft Innovation: Economics, Product Aesthetics, and the Creative Industries," OUP Catalogue, Oxford University Press, number 9780199697021.
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    8. Tarziján, Jorge & Brahm, Francisco & Daiber, Luis Felipe, 2008. "Entrepreneurial profitability and persistence: Chile versus the U.S.A," Journal of Business Research, Elsevier, vol. 61(6), pages 599-608, June.
    9. Stefano Brusoni & Elena Cefis & Luigi Orsenigo, 2006. "Innovate or Die? A critical review of the literature on innovation and performance," KITeS Working Papers 179, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Sep 2006.
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    11. Ali Murad Syed & Zahid Riaz & Abdul Waheed, 2016. "Innovation, Firm Performance And Riskiness: Evidence From The Leading Worldwide Innovative Firms," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(07), pages 1-19, October.
    12. Paul M. Vaaler & Gerry McNamara, 2010. "Are Technology-Intensive Industries More Dynamically Competitive? No and Yes," Organization Science, INFORMS, vol. 21(1), pages 271-289, February.
    13. David Ratigan & Peter A. Zaleski, 2024. "The Drucker indexes and profitability: a first look," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 59(2), pages 78-85, April.
    14. Luis Enrique Valdez Juarez, 2017. "Corporate Social Responsibility: Its Effect on SMEs," Journal of Management and Sustainability, Canadian Center of Science and Education, vol. 7(3), pages 75-89, September.
    15. Ljiljana Božić & Valerija Botrić, 2011. "Innovation Propensity in the EU Candidate Countries," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 18(2), pages 405-417, December.
    16. Rodrigo Rodrigo Barra Novoa Barra Novoa, 2022. "An appreciative theorizing approach to gazelle enterprises assisted by the Arica Business Center," Post-Print hal-03916747, HAL.
    17. Bernd Görzig & Martin Gornig, 2013. "Intangibles, Can They Explain the Dispersion in Return Rates?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 59(4), pages 648-664, December.
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