Abstract
Abstract This study examined companies from two different groups of countries in Central and Eastern Europe and their partnerships with the Government for the development of four types of innovation (product, process, organizational, and marketing). The research included ex-soviet republics (Eu members and non-members), and observed how each type of innovation affects the firms’ financial performance. A sample of 1,143 manufacturing SMEs from the Business Environment and Enterprise Performance Survey (BEEPS) were tested using multiple regression and logit. Based on the absorptive capacity theory, the results show that manufacturing SMEs from EU-member countries have a higher absorptive capacity and take advantage of the EU’s innovation promotion programs to innovate. On the other hand, the SMEs from non EU-member states perceive a quicker effect of the innovations in financial performance, considering that there is a technological gap between the two groups (non EU-members are less developed). Also, the introduction of different types of innovations simultaneously boosts the performance of firms from non EU-member countries in the short run.
Highlights
More than 27 years after the fall of the Berlin wall, the economic transition of the Central and Eastern Europe (CEE) countries, which includes the European ex-soviet republics, were successful (ASLUND, 2014; ATELJEVIĆ and TRIVIĆ, 2016) as they became real market economies
This paper empirically investigated the relevance of the relationship with the government in the development of the four types of innovation described by the Oslo Manual in manufacturing small and medium-sized enterprises (SMEs) of two different groups of CEE countries that changed from socialism to capitalism after the fall of the Berlin wall in 1989: the ones that joined the European Union (CEUs), and the ones that are out of EU (CNEUs)
The higher average of the CEUs’ in the three performance indicators analyzed in this manuscript is consistent with our proposition that a higher performance of firms in a country helps to improve its economic development, which is higher for CEUs
Summary
More than 27 years after the fall of the Berlin wall, the economic transition of the Central and Eastern Europe (CEE) countries, which includes the European ex-soviet republics, were successful (ASLUND, 2014; ATELJEVIĆ and TRIVIĆ, 2016) as they became real market economies. Significant differences can be found among these countries. The inequality between them can be perceived through an analysis of three widespread indicators: the gross domestic product per capita (GDP), the human development index (HDI) and the global innovation index (GII). According to the World Bank (2015), Slovenia is the best among these countries in GDP (33rd in the world). Moldova is the worst (135th position worldwide). Analyzing the HDI, Slovenia is in the best position (26th in the world), and Moldova is again in the worst, only in the 107th position (UNITED NATIONS, 2015). If we consider the innovative capacity of the country (GII), Estonia is in the 24th position compared to the rest of the world and Albania is the worst, in the 92nd position
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