A team of researchers analysed the interplay between a phenomenon known as Regional Institutional Quality (RIQ), firms’ resources and innovative activity. The original working paper is entitled ‘Institutions, Resources and Innovation in Developing Countries: A Firm Level Approach’ (2014) by Laura Barasa, Peter Kimuyu, Patrick Vermeulen, Joris Knoben and Bethuel Kinyanjui. The data used for analysis concerned firm-level data from the World Bank Enterprise Survey and the Innovation Follow-up Survey, for the years 2010 to 2012, for Kenya, Tanzania and Uganda. This policy brief provides the research approach, main outcomes and policy implications of the paper. The main outcome is that the effect of firm-level resources on innovation is positively moderated by institutions. Thus RIQ plays a distinct role with respect to the extent to which firms successfully extract value from resources into innovative output in the context of developing countries. The value of firm-level resources significantly depends on the institutional environment within which the firm operates.
Basara, L.; Voeten, J. Policy Brief: Institutions, Resources and Innovation in Developing Countries: A Firm Level Approach. Tilburg University, Tilburg, Netherlands (2015) 4 pp.