Obstacles to innovation in Brazil: measurement and policy responses

Abstract

ABSTRACT Recent literature has turned to the study of obstacles to innovation as a fruitful avenue for policy-driven research. This article contributes to such literature by implementing an in-depth analysis of the Brazilian Innovation Survey via propensity score matching to assess the extent to which the innovation policy measures in place have been effective in alleviating innovation barriers. While the country’s set of innovation policy programmes has expanded and diversified over the past several years, there is a dearth of empirical verification of their effects on the hindrances that companies face. We found that the only policy instruments effective in lowering the perception of innovation barriers in Brazil are acquisition of machinery and public procurement. As expected, companies treated by these policies experienced less financial and demand barriers than untreated companies. On the other hand, organizational and network obstacles to innovation have proved to be the barriers less addressed by the various policies. Even companies treated by some policies, such as economic subsidy or public funding, perceive more of these barriers than the untreated companies. This situation points out to a possible innovation policy gap in Brazil as regards the absence of specific policies to tackle organizational and network issues.