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Innovation and Performance: An Empirical Study of Russian Industrial Companies

Author

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  • Arkady Trachuk

    (Department of Management, The Financial University, Under the Government of the Russian Federation, 15 Ulica Verhnjaja Maslovka, Moscow 127083, The Russian Federation)

  • Natalia Linder

    (Department of Management, The Financial University, Under the Government of the Russian Federation, 15 Ulica Verhnjaja Maslovka, Moscow 127083, The Russian Federation)

Abstract

The paper investigates the relationship between investment in research and development (R&D), innovation expenses, and productivity of manufacturing companies. These empirical results have shown that innovation investments (1) improve the performance of industrial companies with the elasticity of 0.09; (2) innovation investment has an impact on the performance of the company, and the extent of this impact depends on the value of R&D investment and has a range of elasticity ranging from 0.03 (for low volumes of R&D investment) to 0.16 in high volumes of R&D investment; (3) the relationship between innovation investment and the growth of performance is nonlinear in nature and has a strong positive relationship only after a critical mass of innovation investment has been reached; (4) a significant role in the relationship of innovation investment and productivity is played by the features of the industry in which the company operates (the companies that operate in high-tech industries not only invest more in R&D and innovation but also have a better performance due to research and development); (5) companies of low-tech industries have a negative elasticity of innovation investment and productivity, which is due to the influence of unprofitable innovation investments (appropriability effect), i.e. additional profits from the investment are not significant.

Suggested Citation

  • Arkady Trachuk & Natalia Linder, 2018. "Innovation and Performance: An Empirical Study of Russian Industrial Companies," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 15(03), pages 1-22, June.
    • Handle: RePEc:wsi:ijitmx:v:15:y:2018:i:03:n:s021987701850027x
    DOI: 10.1142/S021987701850027X
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    2. Olusesan Michael Awoleye & Olugbenga Matthew Ilori & Timothy Oyedepo Oyebisi, 2019. "SOURCES OF INNOVATION CAPABILITY AND PERFORMANCE OF ICT AGGLOMERATED MSMEs IN NIGERIA," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 24(04), pages 1-33, June.
    3. G. G. Nalbandyan, 2019. "Internationalization Strategies Of Russian Non-Energy Companies," Strategic decisions and risk management, Real Economy Publishing House, vol. 10(1).
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    5. Sara Picas & Pedro Reis & António Pinto & José Luís Abrantes, 2021. "Does Tax, Financial, and Government Incentives Impact Long-Term Portuguese SMEs’ Sustainable Company Performance?," Sustainability, MDPI, vol. 13(21), pages 1-16, October.
    6. González-Martinez, Paulina & García-Pérez-De-Lema, Domingo & Castillo-Vergara, Mauricio & Hansen, Peter Bent, 2023. "Determinants and performance of the quadruple helix model and the mediating role of civil society," Technology in Society, Elsevier, vol. 75(C).
    7. Kseniia Boiko, 2022. "R&D activity and firm performance: mapping the field," Management Review Quarterly, Springer, vol. 72(4), pages 1051-1087, December.
    8. Yu. V. Volodin & P. A. Podkovyrov, 2018. "International Market Expansion," Strategic decisions and risk management, Real Economy Publishing House, issue 4.
    9. Wang, Nannan & Gong, Zheng & Xu, Zhuhuizi & Liu, Zhankun & Han, Yu, 2021. "A quantitative investigation of the technological innovation in large construction companies," Technology in Society, Elsevier, vol. 65(C).

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