Innovation and performance: A collection of microdata studies

There are still many puzzles to be solved concerning the relation between innovation and firm performance, in particular concerning the distinct roles of information and communication technology (ICT) and Research and Development (R&D) in creating new or improved products or production processes. This thesis provides evidence that both instances of innovation are important drivers of productivity and, thus, economic growth. The thesis consolidates the results of empirical work covering about 10 years of research on firm-level data that was aimed at understanding the importance for firm performance of innovation in a broad sense. Using econometric methods and recently developed innovation models, the several chapters investigate the distinct contributions to Total Factor Productivity (growth) of R&D and after controlling for the contributions of other inputs. In addition, special attention is given to role of ICT in enhancing the cumulativeness of innovation processes. This is achieved by analysing the interaction between technological and non-technological innovations and the role of ICT-related network externalities. It is shown that, especially in service production, ICT is an important driver of productivity (growth) and also an important enabler of other (non-technological) innovations. The cumulativeness of innovation is demonstrated by showing that firms that combine technological and non-technological innovations are among the most productive firms.Technology, Policy and Managemen