Innovation Strategies and Economic Crisis: Evidence from Firm-level Italian Data

The disruptive economic downturn of 2008-2009 forced industrial firms to implement strategies to survive and generate new competiveness sources. One of such strategic behaviour regards the way of intervention on several innovation areas through different strategies. Disentangling the effect of pre-crisis adopted innovations, industrial relations quality and economic performance on such strategies may be of extreme relevance to analyse the nexus between the reactions to the challenges brought by the crisis and the capacity of the firms to proactively tackle economic downturns. The present work provides an empirical analysis on the basis of more than 500 Italian manufacturing firms located in Emilia-Romagna region. The results suggest the existence of strong relationships between precrisis innovative activities and the capacity to react to the challenges brought by the crisis. This happens through innovative strategies, whose contents are mainly product (technological competitiveness), process and organisation/HRM innovative dimensions (cost competitiveness/efficiency gaining). Complementary innovative activities emerge as a key factor. Industrial relations quality also determines the direction of the reaction to the crisis: more participative industrial relations support the adoption of diversified types of innovation strategies. There is instead no evidence of a relation between past economic performance and innovation actions in the crisis