Innovation Expenditures Research Articles

China's Jinshan Yinshan sustainability evolutionary game equilibrium research under government and enterprises resource constraint dilemma.

This paper is based on analyzing the process of green innovation inspiration and green innovation compensation effect after the implementation of environmental regulations by the Chinese Government. This paper tests the hypothesis using the evolutionary game model and studies the underlying behavioral characteristics of the government, enterprises, and the relevant influencing factors. These influencing factors further aid in examining the evolution law applicable on both sides, which are aligned with the dynamic replication equation and evolutionary equilibrium states under different situations. The key variables used in this study include the concentration of government’s environmental regulation, the cost of the regulations, economic penalties, enterprise’s green innovation-related income, expenditures, and the enterprise’s performance appraisal. Moreover, the results of this study reflect the system stability and equilibrium strategy on the proportion of retained earnings spent by enterprises on green innovation activities and the Government’s strict environmental regulations. In the process of game strategy selection between the government and enterprises, the net income and weight of eco-efficiency indicators of the enterprises actively carrying out green innovation activities play a decisive role. Moreover, there should be reduced weight of economic benefits and increase the economic sanctions and innovation subsidies of enterprise pollution behaviors. Furthermore, reduced cost of regulations and innovation expenditures help guide enterprises to rationally allocate superior resources to enhance green enterprise innovation and take the level of innovation to the point that it achieves a win-win green sustainable development of economic performance and environmental performance.

Entrepreneurship and Innovation in the Polish Industry

Entrepreneurship is a process in which goals or tasks are set at one’s own initiative, whereby no efforts are spared to ensure their efficient and effective implementation. The concept of entrepreneurship is associated with innovation as entailing ongoing research and the introduction of rational changes and novel ideas. The aim of the research is to determine the regression interdependencies between the number of enterprises (entrepreneurship) and process and product innovation expenditure (innovators' activity) and the number of inventions (inventors' activity), and in the second regression model: also the number of enterprises (entrepreneurship) and process and product innovative expenditure (innovators' activity) and the number of patents (inventors' activities) generated within the Polish industry in the years 2015-2017. The hypothesis is that patents (inventors' activities) get reinforced with process and product innovation expenditures (innovators’ activities) employed in the process of growth of the number of enterprises (entrepreneurship) in industry, as well as the overall efficiency of expenditures and technologies (patents) in the Polish industry over the course of the researched years. Conducted studies have confirmed the above hypothesis. In addition, the research carried out has shown that patents (inventors 'activities) have supplemented the share (elasticity) of process and product innovation (innovators' activities) by 10% in the increase in the number of enterprises (entrepreneurship) as observed in industry. This share is transferred from the supply element to that of demand.

The impact of the innovation on the economy: an empirical analysis for Azerbaijan

Innovation is a basic and important element of economic success. Innovation is seen as a significant factor in boosting product competitiveness in both domestic and global markets, replacing outdated manufacturing equipment, and creating demand for highly skilled workers. It is commonly acknowledged that for the state to develop an effective scientific and technical policy, an information base that depicts the status, scale, and direction of innovation activities throughout the economy is required. Therefore, it is critical to consider both the decimal and descriptive aspects of the information. In short, creating the groundwork for an innovative economy is critical to achieving good outcomes in the country’s socioeconomic growth. The study’s major goal is to examine the economic effect of innovative development in Azerbaijan. The State Statistics Committee of the Republic of Azerbaijan provided the study with statistical information for the years 2000–2021. To begin, the study performed a literature review of various scholars on the issue, and the initiatives adopted by the state in different years to promote creative growth in Azerbaijan were analyzed. Furthermore, indicators such as GDP, the number of people employed in the economy, fixed assets, and innovation costs were utilized to estimate the impact of innovations on economic growth. When coefficients represented in individual variables in the generated model are compared, it is clear that the influence of innovation costs (0.877 or 87.7%) on the amount of activity in the economy is bigger than the effect of fixed assets (0.292 or 29.2%) and the number of employees (0.020 or 2%). At the 0.05 level of significance, the t-statistics and their probabilities associated with the coefficients show that the number of employees has a negative effect on GDP, whereas production funds and expenditure on innovations have statistically significant positive effects on GDP. The estimated F-Statistic and its probability imply that the cumulative result of innovation expenditure on GDP is statistically significant. The study claims a connection between innovation spending and GDP, and that the former has a major influence on the latter. The research also demonstrates that the model’s explanatory variables account for about 98.4% of the changes in the explained variable. This suggests that, in the framework of the model, spending on innovation accounted for about 98.4% of the variation in GDP over the study period. This study, therefore, contributes to the expanding amount of evidence indicating that expenditure on innovation is related to and has a significant impact on GDP. The results of the model also show that an increase in production funds of 1% generates a rise in GDP of 29.3%, a rise in employee numbers of 1% causes a boost in GDP of 2%, and an expansion in innovation expenditures of 1% causes a GDP rise of 87.7%. In this regard, it is thought appropriate to raise innovation costs, particularly during the digital economy transition.

Does mandatory CSR disclosure affect enterprise total factor productivity?

Corporate social responsibility (CSR) reports are important carriers of enterprises non-financial information disclosure, which are inextricably related to the production efficiency and performance of enterprises. The objective of this paper is discovering the causal effect of the CSR mandatory disclosure policy and the total factor productivity (TFP) of enterprises. This paper uses the sharp regression discontinuity design based on the micro data of the enterprises to study the impact by taking China's mandatory disclosure policy in 2008 as a quasi-natural experiment. This paper makes some contribution to the impact of mandatory CSR disclosure on enterprise TFP and the mechanism and heterogeneity of this impact. The research draws the following conclusions: First, the CSR mandatory disclosure can significantly improve the TFP of enterprises on the whole, and this effect has the characteristics of long-term and dynamic decline. Second, the mechanism of mandatory disclosure of CSR on TFP is through the mediating effect of R&D and innovation expenditures. Third, the heterogeneity of the impact of CSR mandatory disclosure on TFP is reflected in two aspects: industry and equity nature differences. These conclusions are strongly correlated with the contingent decision-making behaviour of enterprises and give some ideas to the policy makers.

INNOVATIVE ACTIVITY OF DAIRY ENTERPRISES OF UKRAINE

Background. The dairy industry plays an important role in ensuring the country’s food security, and the consumption of quality dairy products by the population in the required quantity and at reasonable prices is an urgent condition for ensuring the health of the nation. That’s why the study of the main trends and prospects for the development of the dairy market in Ukraine is relevant and important, especially in an unsaturated market. The analysis of recent research and publications hasrevealed the need of studying the innovative aspect of the development of the dairy industry and deter­mi­ning the prerequisites for the innovative activity of dairy enterprises to ensure their competitiveness on the market. The aimof the study is to analyzethe development of the dairy industry in Ukraine in general and in the context of its innovative activities in particular.The tasks of the study were to identify trends, highlight the problems of innovative activities of dairy industry enterprises to ensure successful long-term work on the market and determine the directions for their solution. Materials and methods. In the process of the study, we used statistical methods of analysis, which made it possible to determine the dynamics of the main indicators of the development of the dairy industry and its main structural characteristics. We also used dialectical, abstract-logical and systemic analysis, which made it possible to determine the main positive and negative trends in the development of the dairy industry and, in par­ticular, its innovative activities. Results. In Ukraine, the dairy industry is developing unevenly. The article examines the indicators of the development of the dairy raw material market, the amount of production and consumption of milk per person in Ukraine, the structure of the market of dairy producers, the volume of dairy products production, the volume of innovative products sold by the dairy companies, the number of food and dairy enterprises, that were engaged in innovative activities and introduced innovations according to their types, the number of units of new products that were introduced in the food and dairy industry, the structure of new products introduced in the food and dairy industry, the number of introduced products per enterprise, the amount of innovation expenditures, and the cost efficiency ratio. This made it possible to identify the main trends and problems in the development of the dairy industry and determine the main directions of their solution. Conclusion. The main reasons that hinder the development of the dairy industry in Ukraine and have a negative effect on dairy producers are: lack of raw materials; price fluctuations for raw materials and finished products; law quality of raw materials, un­stable socio-economic situation of the country, decline in the purchasing power of the population, loss of some international sales markets; decrease in market capacity due to the loss of control over the part of the territory of Ukraine. At the same time, the deve­lopment of technical and technological basis doesn’t allow manufacturers and processors to reduce prices and stimulate demand; the links between producers and processors aren’t optimized in terms of delivery charges; low world prices for dairy products reduce the export potential of domestic dairy products. Therefore, there is a need for significant adap­tation of dairy producers to export requirements.

Profiting from innovation in the aftermath of an economic crisis

Purpose The aim of this paper is to present systematically a variety of benefits from innovating in response to an economic crisis. Design/methodology/approach This is a conceptual paper that draws on prior conceptual and empirical studies, especially the innovation-based view of firm performance. Findings Many firms have cut their innovation expenditures in response to the COVID-19 crisis. However, the financial crisis in 2008/2009 has shown that these short-term cost savings may have severely negative consequences on competitiveness. Several innovation examples from the crisis due to the COVID-19 pandemic further indicate that companies may benefit from a variety of first-order innovations, which go considerably beyond product development. Consequently, researchers and executives need to consider the variety of innovation types beyond product development, and they further need to emphasize second-order innovations, which describe the dynamic transformation of innovation management. Originality/value Academics and practitioners need to put specific attention to the transformation of innovation processes at the beginning of a crisis because firms may have to redesign their innovation processes. This dynamic reconfiguration and realignment of innovation processes further is essential again if a crisis continues for a longer period, such as the crisis due to the coronavirus pandemic. For example, if a company currently does not respond to relevant trends, its competitive position will deteriorate because other companies will enter the market. If firms can afford to continue or strengthen the innovation activities, they may profit substantially after the crisis.

Organizational Slack and Innovation Expenditures in Leveraged Buyout Companies

We study leveraged buyouts (LBOs) to understand how actual and potential organizational slack affect exploitative and exploratory innovation expenditures. LBO companies are characterized by limited actual and high potential organizational slack and, based on theories of organizational search, we predict that both exploitative and explorative innovation expenditures be higher in LBO companies than in non-LBOs. These differences also depend on the technology intensity of the sector in which the target firm operates. The empirical analysis of 882 LBO companies in the UK community innovation survey broadly supports this argument.

Slack organisationnel et dépenses d’innovation des entreprises sous LBO

Nous étudions les opérations de leveraged buyouts (LBO) pour comprendre comment le slack organisationnel réel et le slack potentiel influencent les dépenses d’innovation d’exploration et d’exploitation. Les entreprises ayant fait l’objet d’un LBO sont caractérisées par un slack organisationnel réel limité tandis que leur slack potentiel est élevé. À partir des théories du comportement de recherche des organisations (organizational search theories), nous prédisons que les dépenses d’innovation d’exploration et d’exploitation seront plus élevées dans les entreprises ayant fait l’objet d’un LBO que dans les autres. Ces différences dépendent aussi de l’intensité technologique du secteur d’activité de l’entreprise. L’analyse empirique de 882 entreprises ayant fait l’objet d’un LBO présentes dans l’enquête CIS pour la Grande-Bretagne tend à confirmer notre argumentation.

Outpatient paediatric hand surgery: strategy in healthcare implementation and cost-efficient manner.

The increasingly cost of health care is a relevant problem as well as prolonged waiting time for admission also in emergencies. Effective cost containment measures and expenditure controls are needed to achieve and maintain clinical and organizational appropriateness. Outpatient management has proven to be the most useful method for lower-cost treatment in less severe pathologies, requiring surgery without hospitalization. The current study provided to evaluate how this model was successfully applied also to the paediatric population in hand surgery. Methods. A retrospective cohort study of 645 patients from 8 to 18years (mean age 14.9) was performed in children treated in outpatient setting from 2015 to 2019. The direct costs were evaluated as well as the mean waiting time for surgery, comparing the data with the previous five-year period. The mean reduction in waiting time for children emergencies was 57% (from 72 to 31h) due to the Outpatient setting into a dedicated Day-Surgery Service organizational model. The visual graphed data showed a general clear growing trend towards outpatient surgery in adults and children. The overall effect was a 29.2% of reduction in spending between expected and achieved costs, recovering resources toward the increasing technology and innovation expenditures. Outpatient paediatric hand surgery was an effective and attractive option which leaded to decreased individual and social costs, with increased clinical and organizational appropriateness. Thus, reduced delay in treatment and provided benefits for children and familiars.

Innovation intensity and skills in firms across five European countries

This study attempts to establish the importance of specific formally achieved higher skills for the innovation intensity in firms across a group of European countries. Innovation expenditures are calculated as the ratio to turnover and the main explanatory variable is the proportion of highly skilled employees (tertiary education in ICT-oriented or other fields). The analysis employs official data on innovation activities (Community Innovation Survey) in firms for the period 2004–2010, linked to registers on education and businesses as well as to the Structural Business Statistics including 34,000 observations. Estimation results show a strong significantly positive relationship between the innovation intensity and the proportion of highly ICT skilled employees. Higher skills outside the field of ICT are also important for the innovation activities. Control variables reveal that the innovation intensity significantly increases with joint national and EU funding while the role of firm age varies. The significant and negative link to firm size reveals a lack of advantages of scale, a finding possibly related to the use of a comprehensive measure of innovation activities. There are also indications that industry affiliation is essential for the innovation intensity.

Innovation and productivity in Turkish manufacturing firms

ABSTRACT This paper presents a CDM model to investigate the relationship between innovation and productivity for Turkey as a developing country. The results suggest that innovation expenditure increases the probability of innovation, and that innovation affects productivity positively, when other relevant variables are controlled for. As well as the industry-specific concentration ratio, we also investigated the role of firm-specific determinants of innovation such as human capital, exporting, and market share in the innovation – productivity link.

An ecosystem approach to managing innovative development in industry

Despite relatively high innovation expenditures, innovative performance of the Russian industry is far behind the developed countries. This is largely due to the lack of adequate tools for choosing appropriate managerial impacts to exert on the innovative potential of industry. The study aims to develop methods for predicting the effects of managerial impacts on the innovative development of industrial ecosystems and test them on the case of the Russian water industry. Methodological basis of the research comprises the theory of industrial development, and ecosystem approach. The research method is cognitive modelling of managerial impacts on the development of innovation ecosystem of the water industry. The calculations are performed using the authors’ programme Cognitive Modeling Complex Systems. The researchers develop a cognitive map, which allows forecasting the effects of managerial impacts that regulate inter actions between the ecosystem participants. The suggested tools help to choose rational forms of partner relationships, and as a result, increase the efficiency of the functional cycle of the innovation process management. Both companies and government bodies can apply the results of the study to create scenarios and strategies of innovative development in industry.

Innovation indicators based on firm websites—Which website characteristics predict firm-level innovation activity?

Web-based innovation indicators may provide new insights into firm-level innovation activities. However, little is known yet about the accuracy and relevance of web-based information for measuring innovation. In this study, we use data on 4,487 firms from the Mannheim Innovation Panel (MIP) 2019, the German contribution to the European Community Innovation Survey (CIS), to analyze which website characteristics perform as predictors of innovation activity at the firm level. Website characteristics are measured by several data mining methods and are used as features in different Random Forest classification models that are compared against each other. Our results show that the most relevant website characteristics are textual content, the use of English language, the number of subpages and the amount of characters on a website. In our main analysis, models using all website characteristics jointly yield AUC values of up to 0.75 and increase accuracy scores by up to 18 percentage points compared to a baseline prediction based on the sample mean. Moreover, predictions with website characteristics significantly differ from baseline predictions according to a McNemar test. Results also indicate a better performance for the prediction of product innovators and firms with innovation expenditures than for the prediction of process innovators.

Regional innovation performance and structural conditions in Central and Eastern Europe: embracing the broad-based innovation concept

Motivation: There is plenty of evidence suggesting that the (regional) innovation systems in Central and Eastern Europe (CEE) are in their early beginnings and that this poses huge challenges to the implementation of the smart specialization agendas and to the efficient use of the European structural and investment funds in these countries. Our assumption is that structural differences explain to a large extent the differences in innovation performance between the CEE and non-CEE regions and that the future growth trajectories of the CEE regions should more specifically embrace the broad-based innovation concept. Aim: Our study attempts to test whether there are statistically significant differences between the CEE and non-CEE regions in each component of the European Regional Innovation Scoreboard and whether such differences can be explained by the variations in structural conditions. To this purpose, we use a discriminant factor analysis and test the correlations between the discriminant function and various structural indicators. Results: The R&D-based component of the regional innovation systems discriminates the most between the CEE and the non-CEE regions. In contrast, the differences between the two groups are minimal in terms of Non-R&D innovation expenditure, Tertiary education or Employment in Medium and High-Tech Manufacturing. On the whole, the differences in innovation performance, as reflected by the discriminant function, can be largely attributed to the differences in economic performance (GDP per capita) and in the industrial structures. All these considerations give support for the adoption of the broad-based innovation policy at the CEE level, which goes beyond the R&D investments and gives widespread support to both technological and non-technological innovation, skills upgrading or the integration into international networks and value chains.

İmalat İşletmelerinin Sürdürülebilir Süreç İnovasyonu (SSİ) Faaliyet ve Sonuçlarının PLS-SEM ile Değerlendirilmesi (The Evaluation of Sustainable Process Innovation (SPI) Activities and Results in Manufacturing Organization via PLS-SEM)

Purpose – To investigate with the help of an exploratory model whether the expenditures for sustainable process innovation in the food, chemical, metal, automotive and textile sectors that stand out in the manufacturing sector affect the environmental and social activities of SPI and also whether these activities have a positive effect on the SPI results. Design/methodology/approach – Data were collected from manufacturing companies through an online questionnaire and data analysis was performed using the PLS-SEM methodology via Smart PLS software. Findings – Sustainable process innovation expenditures have a positive impact on environmental and social activities in all sectors. While it was observed that the environmental activities carried out to obtain SPI reached the results of SPI in all sectors, it was revealed that social-oriented activities had a positive effect on the SPI results in the automotive and textile sectors, but these activities did not achieve the desired results in other sectors. Discussion – The positive reflection of the expenditures to gain SPI to realize environmental and social focused SPI activities in all sectors can be an indicator of the ability of the manufacturing sector to transfer SPI inputs to these processes. Similarly, the positive impact of environmentally focused activities on SPI results leads to the outcomes that the acquisition of new sustainable processes or significant improvement of existing processes can be successfully implemented internally and registered. Moreover, social-focused activities are handled in an integrity in automotive and textile enterprises and included in the manufacturing processes while other three sectors have not been satisfactory to integrate these activities into processes and to register their results.

Firm specific determinants of open innovation in European SMEs

To manage the changing innovation landscape a key strategic decision for owner-managers of SMEs is the extent to which they adopt open innovation. Extant research however has tended to study open innovation processes in terms of a binary distinction- either open or closed. The purpose of this paper is to move beyond this dichotomous framing and identify the extent of openness in the innovation processes of SMEs in Europe. Furthermore, the study explores the association between internal firm-specific factors related to the capabilities and strategies of the firm and open innovation in SMEs. This study explores if (a) innovation objectives, (b) innovation activities, and (c) innovation expenditures, influence the extent of openness in the innovation process in SMEs. Drawing on data from the 6th Community Innovation Survey (CIS) of 9,949 SMEs from nine European countries, hypotheses are tested using hierarchical multiple regression analysis. The study contributes to the literature by showing that the extent of openness in the innovation process is low for European SMEs. SMEs are more likely to be characterised by higher levels of openness in their innovation if they prioritise product/process innovation objectives, conduct internal R&D, purchase/license external knowledge, and commitment more financial resources to innovation.

Determinants of innovativeness of Slovak SMEs

The integration of the Slovak Republic into the European Union and the globalization process create conditions that significantly reduce barriers to entry into particular markets, but, on the other hand, enhance the intensity of competition. The relevance of the study lies in the extent of the European Union’s support for the effectiveness of innovation activities in Slovakia. This paper investigates the influence of endogenous and exogenous factors on the competitiveness of Slovak enterprises over the period 2006–2018. The study is aimed at determining the causal relationship of factors that determine the competitiveness of enterprises. To investigate the relationship between the endogenous and exogenous factors, the Granger causality method is used. Mathematical models are used to identify the relationship between innovation expenditures on the one hand and different types of innovation activity with market expansion on the other. The results of the study provide a statistically significant relationship between the performance measured by the percentage of revenues of enterprises that have introduced innovations with a two-year lag and the concentration measured by the total R&D expenditure of an enterprise. The results of this study should also be used to ensure that, in the case of the Slovak SME sector, R&D expenditure is a significant driver of innovation in enterprises, as innovation in enterprises is expected to improve the quality of products and services, increase profits and expansion in domestic and foreign markets. AcknowledgmentThis paper has been supported by funds of the project VEGA No. 1/0240/20 and VEGA No. 1/0813/19 Managing the development of innovative and start-up forms of businesses in international environment and verification of INMARK concept, which has received funding from the Ministry of Education, Science, Research and Sport of the Slovak Republic.

CEO pay sensitivities in innovative firms

PurposeThis study aims to investigate whether compensation committees provide the chief executive officers (CEOs) with incentives to undertake “income-decreasing” but potentially “value-enhancing” innovation expenditures. The authors specifically analyze pay–performance relationships for innovative firms relative to all other firms. This study is critical because innovation is expensive and has uncertain outcomes.Design/methodology/approachUsing alternative accounting performance measures and market performance measures, the authors estimate an econometric model of CEO compensation in innovative firms that incorporates the interaction of endogenous innovation and firm performance.FindingsThe authors document an incremental positive association between changes in accounting performance measures and CEO compensation changes in innovative firms relative to other firms. This sensitivity of executive pay to firm performance is higher for firms that innovate. These results support the hypothesis that compensation committees provide incentives to carry out risky innovation by tying executive compensation more closely to firm performance. This finding survives a battery of sensitivity tests.Practical implicationsThe implications of this study are significant. Capital needs to support risky research and development investments (Tidd and Besant, 2018; Baldwin and Johnson, 1995) form the basis of innovative firms' operations. Considering these expenses, if CEOs, who play a critical role in the scanning, adapting and implementing innovative needs in a firm, are not protected and compensated for making risky choices, the entire investment itself will be threatened. Hence, the findings reiterate and support earlier findings that speak to the importance of compensating CEOs to make high-risk investments that will lead to long-term economic and financial gains for the firm when the innovative behaviors result in competitive market shares and profits.Originality/valueThe original work is related to the investigation of pay–performance sensitivity in the presence of innovation, which has not been fully investigated in prior literature.

Justification of a new paradigm of interaction between human capital and economic growth in the innovative economy

. Human capital theory serves as the scientific basis for development of innovative economics. It is human capital that determines the maintenance of quality parameters of economic growth providing for efficient development of economics of modern states. The purpose of the authors is to justify theoretical and methodological expositions of human capital management in the innovative economics. The latter is regarded as an economic system based on the innovative activity of the business entities and individuals, on the permanent technological enhancement. Such an economic system is developing due to on-going generation of new knowledge. The authors present the results of their copyright study of genesis of system human capital paradigm of innovative economics as a research concept which implements and concretizes a holistic approach to revealing the patterns and causal relationships within the system of human capital of innovative development. The method of the study is based on using monographic method, statistical methods, charts, tables, graphs and other means to visualize the findings. As a result, the authors ascertain the shift in the economic science from classical understanding of how economic growth is impacted by education in innovative economics to considering economic growth as the main driver for development of education. The authors adduce the results of statistical analysis of interrelation between the volumes of technological innovation expenditures, the aggregate level of organizations’ innovative activity and the index of human development on the international level. By means of nonparametric methods the authors discover that the development of human capital, educational potential and the level of innovation development in the regions of Russia are moderately interrelated. The authors come to the conclusion that Russian economics is unique in comparison with other countries due to the combination of the high level of human capital development and low pace of economic and innovative development. As a result, they have found out that, considered as part of human capital management providing for innovative development, investments in education can be more efficient only if science, education and business integrate to train their employees within the context of the new paradigm of interrelation between human capital and economic growth in innovative economics in which investment in innovation and technology is regarded as the main driver of development of education.

Factors of the circular economy development

Subject. Today the circular economy is viewed as a new model of economic growth that allows overcoming resource constraints. Despite the general understanding that environmental problems are the main incentive for the transition to circular models of production and consumption, the underlying factors in the development of this economic model have not been fully studied in modern literature. Are circular production models available only to technologically highly developed rich countries, or, conversely, poverty and a total lack of resources are the best incentive for the development of a circular economy? Objectives. I study the influence of such factors as the general economic and innovative development of the country, as well as the State's innovating activity to form and develop circular models of economic growth. Methods. The research was carried out with methods of econometric modeling. Eurostat data were used as an underlying source of information. Results. The study showed that the high level of the national economic development positively influences the resource efficiency of an economy, but more advanced countries produce more waste in the consumption sector. Production and consumption waste recycling demonstrates better trends in less economically developed countries. Countries with substantial innovation expenditures tend to have more robust municipal and industrial waste recycling technologies, as well as a more effective use of secondary materials. The development of an e-waste recycling system is essentially dependent on government incentives for innovation in this area. Conclusions. The findings can be used for outlining national federal and regional programs for the development of production and consumption waste recycling mechanisms in Russia. Social entrepreneurship and business initiative may appear one of the priority mechanisms spurring the circular economy in Russia through traditional patterns of resource-saving consumer behavior.