The Impact of Innovations on Enterprise Productivity in Russia

Innovations are a source of long term economic growth for the countries. Innovationsdefine competitiveness of business, and in a broader sense, they can solve a great number ofsocial and economic problems. Therefore the issue of innovations and their role in the economyis highly important. The aim of our work is to estimate the impact of innovations on productivityof enterprises in Russia and to reveal the determinants of innovative activity. Design/methodology/approach: Our research is based on Business Environment andEnterprise Performance Survey (BEEPS) for the years 2012-2014 and covering 1564 Russianenterprises. CDM model applied in our research involves three steps of estimation and allowsto take into consideration various groups of factors affecting investment into R&D, and thenimplementation of innovations. Findings: The results of econometric analysis show positive significant returns innovations forproductivity of all firms. Positive impact of obstacles associated with investment into R&Dprobably arise because firms involved in innovative activities face greater difficulties due tospecific features of institutional environment. Besides, practically all ways of collaborationfacilitate increase in innovative sales relatively more than firms' own ideas. Research/practical implications: Our research contributes to understanding firms' innovativeactivities. The role of various groups of factors on the firm and regional level is studied. Resultsprovide useful information both for improvement of management activities at the firm level andfor designing economic policy measures for innovative environment in the regions and in thecountry overall. Originality/value: To the best of our knowledge, CDM model allowing to deal withendogeneity of innovations has not been applied to study innovations and their results for theRussian enterprises of different technological groups yet.