Public Support, Innovation and Productivity in Polish Manufacturing: Evidence from an Extended CDM Model
Public Support, Innovation and Productivity in Polish Manufacturing: Evidence from an Extended CDM Model

Summary/Abstract: RESEARCH OBJECTIVE: This paper explores the intricate relationship among public financial support, R&D&I expenditures, innovation, and labor productivity in Polish manufacturing firms. THE RESEARCH PROBLEMS AND METHODS: Using the framework proposed by Busom&Vélez-Ospina (2017), we modify the CDM model to include enterprises’ access to public support for innovation activities. Our analysis, based on a 2018 survey of 1049 randomly selected Polish manufacturing enterprises and financial data from the Orbis database, our reveals several key insights. THE PROCESS OF ARGUMENTATION: The first part reviews the literature on the relationship between innovation input, innovation output, and productivity. An empirical analysis of the relationship between public financial support, R&D, innovation, and productivity in Polish manufacturing firms follows this. RESEARCH RESULTS: Public financial support significantly stimulates innovation expenditures among firms, yet it does not statistically influence firms’ propensity to engage in innovation activities. Innovative input positively impacts product, process, and marketing innovation, but the resulting innovation output does not significantly affect labor productivity in Polish manufacturing firms. CONCLUSIONS, INNOVATIONS, AND RECOMMENDATIONS: The findings highlight the complex dynamics between public financial support, R&D, innovation, and productivity in Poland’s manufacturing sector. Policymakers must evaluate the efficacy of public funding mechanisms to foster innovation and improve productivity outcomes.

• Details
• Contents