Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/34124 
Year of Publication: 
2006
Series/Report no.: 
IZA Discussion Papers No. 2386
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
While many firms compete through the development of new technologies and products, it is well known that new-to-the-world innovation is inherently risky and therefore may increase the probability of firm death. However, many existing studies consistently find a negative association between innovative activity and firm death. We argue that this may occur because authors fail to distinguish between innovation investments and innovation capital. Using an unbalanced panel of over 290,000 Australian companies, we estimate a piecewise-constant exponential hazard rate model to examine the relationship between innovation and survival and find that current innovation investments increase the probability of death while innovation capital lowers it.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size
292.24 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.