Relationship between market and institutional networks and technological innovation: an analysis of peruvian manufacturing firms

Universidad Esan ,La Salle International School ,Javier Fernando Del Carpio Gallegos,Alejandro Erasmo Loli Pineda,Francesc Miralles

doi:10.17230/ad-minister.38.3

Universidad Esan , La Salle International School + Show 3 more

Open Access

https://doi.org/10.17230/ad-minister.38.3

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Abstract

Firms strive to develop technological innovations. This study focuses on two main objectives: to identify the relationship between market and institutional networks and technological innovation; and to analyze the relationship between the obstacles that firms assess when developing innovations. The literature shows that there has been little interest in researching innovation in emerging economies, in which there is a greater presence of low-technology intensity firms that also develop technological innovations. Using data from 705 Peruvian manufacturing firms, a partial structural equation model was applied. The results showed that when firms are linked to networks, their capacity for technological innovation improves.

Highlights

Firms are facing environments that are increasingly competitive, which has forced them to develop innovations
The perspective of this study focuses on the role that market and institutional networks can have on technological innovation capability
The structural equation model (SEM) model hypotheses relate firms’ technological innovation capability, divided into two types: product and process innovation, to the connections that firms have with market and institutional networks and, to the possible obstacles that the firms could encounter when trying to carry out innovation activities

Summary

Introduction

Firms are facing environments that are increasingly competitive, which has forced them to develop innovations When they do not have all the resources to innovate themselves, they find it necessary to associate with third parties so that these third parties can provide them with knowledge (Xie et al, 2013). In order to carry out the desired innovations, firms seek to develop market networks that are made up of many parties, including their customers, suppliers, competitors, consultants, and headquarters. Firms that connect with suppliers of technology are in a better state to develop process innovations (NajafiTavani et al, 2018), and Ozdemir et al (2017) argue that firms seeking alliances with their competitors manage to deepen their knowledge and to improve their new product development processes; at the same time, they are abler to explore new market opportunities. Firms that develop the ability to connect to collaboration networks are more likely to develop product innovations (Ghauri et al, 2016)

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