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Subsidies, Enterprise Innovativeness and Sustainable Growth

Author

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  • Sabina Zampa

    (University of Primorska, Slovenia)

  • Stefan Bojnec

    (University of Primorska, Slovenia)

Abstract

This paper investigates associations between the subsidies, innovativeness, sustainable enterprise efficiency and growth. The focus of the study is on the subsidies for co-financing of purchases of new technological equipment with aim to increase enterprise innovativeness and production of new products. The analysis focuses only on the subsidies for co-financing of purchase of new technological equipment. This in-depth analysis of the three data sources from enterprise accounts, subsidies for technological equipment, and surveys in enterprises represent an important data management tool to evaluate achievement effects of subsidies as an important research, managerial and policy question. Subsidies can mislead enterprises that instead of improving efficiency they redirect attention to capture subsidies. The paper employs a combination of enterprise accountancy data, data on subsidies and unique in-depth enterprise level survey data. The analysis is conducted for the enterprises, which have received subsidies for innovation activities. The focus of the analysis is on the following four economic-financial indicators: total revenues, number of employees, profits and value-added per employee. The principal component analysis and multiple regression analysis are used to test the hypotheses related to the four economic-financial indicators and their comparisons. The principal component analysis revealed four components: supports for innovativeness, procedures and standards for innovation, innovation as condition, and the ways of innovation. The multiple regression analysis confirmed the positive association between innovativeness and enterprise efficiency.

Suggested Citation

  • Sabina Zampa & Stefan Bojnec, 2015. "Subsidies, Enterprise Innovativeness and Sustainable Growth," MIC 2015: Managing Sustainable Growth; Proceedings of the Joint International Conference, Portorož, Slovenia, 28–30 May 2015,, University of Primorska, Faculty of Management Koper.
    • Handle: RePEc:mgt:micp15:404-418
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    References listed on IDEAS

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    1. Charles Bérubé & Pierre Mohnen, 2009. "Are firms that receive R&D subsidies more innovative?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 42(1), pages 206-225, February.
    2. Dirk Czarnitzki & Cindy Lopes-Bento, 2014. "Innovation Subsidies: Does the Funding Source Matter for Innovation Intensity and Performance? Empirical Evidence from Germany," Industry and Innovation, Taylor & Francis Journals, vol. 21(5), pages 380-409, July.
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