Impediments to innovation: evidence from Malaysian manufacturing firms

This work investigates the impediments to innovation faced by Malaysian manufacturing firms and whether they differ between firms that eventually engage in innovation activities and firms that do not. The shortcomings and obstacles encountered are assessed. Complementarities between the obstacles are also evaluated. The data are taken from the National Survey of Innovation 2000-2001 carried out in 2003 and the results show that firms which are engaged in innovation activities are more likely to face impediments. The level of importance of obstacles and the way the obstacles combine to impede innovation activities are also different for the two groups. Policies to encourage innovation should consider the different needs of firms that are engaged in innovation activities and firms that are not.