Does technological innovation undertaken alone have a real pivotal role? Product and marketing innovation in manufacturing firms

This paper investigates the role of non-technological innovation on firms’ innovation\r\npropensity and performance. We note that emphasis on technological innovation\r\nalone is misleading, as a firm’s decision to undertake technological innovation brings\r\nabout a more complex and general process which may involve new attitudes regarding\r\norganization and market orientation. We analyse the relationship between product\r\nand marketing innovation in manufacturing, focusing specifically on the food industry.\r\nWe propose a bivariate probit model in which product and marketing innovation are\r\nestimated taking into account their reciprocal interactions. This enables us to provide\r\nmore efficient and realistic estimates of a firm’s probability of introducing either a new\r\nor improved product or a new marketing technique. In addition, the proposed model\r\nprovides the determinants of such probabilities.