Making sense of innovation by R&D and non-R&D innovators in low technology contexts: A forgotten lesson for policymakers

Abstract

This paper attempts to use an integrated theory based on a firm’s internal and external sources of knowledge framework to analyze how different are R&D from non-R&D activities to innovate, specially in a context of low and medium low tech (LMT) sectors where most of the firms are SMEs. Simultaneously, the paper also explores the key differences between R&D and non-R&D innovators. The empirical analysis is based on a representative panel of 2023 Spanish manufacturing firms for 2005 and 2006 from the Spanish Ministry of Industry. Innovation in product and process is explained using non-R&D variables such as in Marketing, Design or hiring tertiary degree employees. Only innovation in product is explained by R&D expenditures. Addressing innovation in process, R&D variables work in few cases and neither R&D expenditures but occasionally R&D employees and are specially relevant the non-R&D variables. The interaction (moderating) effect is specially negative and significant, addressing the substitution effect with different implications regarding product or process innovation. Therefore, innovation can be explained using non-R&D variables such as investments in Marketing, Design, and other routines linked to human resources, technology monitoring committees or the existence of a formal plan to innovate. The firms with more internal resources, those which conduct R&D activities present a better AC and it leads to engage in cooperation agreements and access to external flows of knowledge. The paper has important implications for policymakers due to the fact that most of policies for R&D are based on R&D programmes, while there are other realities: non-R&D factors which also explain innovation, specially when considering low tech sector contexts. El presente articulo usa la teoria de recursos y capacidades para, a traves de los recursos internos y externos de las empresas, analizar las actividades de R&D y las actividades de no-R&D en su impacto sobre la performance de innovacion de la empresa, en un contexto sectorial de baja y media tecnologia. Asimismo, el articulo explora el rol innovador de las empresas que hacen R&D y las que no lo hacen. Con una muestra de 2023 empresas manufactureras espanolas, obtenemos un comportamiento innovador para la innovacion en producto y en proceso y, sobre todo, observando que las actividades de R&D tienen muy poco peso explicativo sobre el resultado de innovacion. El articulo presenta implicaciones para la Academia y los policymakers, sobre todo por el hecho de que la mayoria de las politicas de innovacion se basan en actividades de R&D.