An Evolutionary View of Innovation and Economic Performance: A Firm Level Analysis

It is rather consensual that firm growth driven by financial long run profits seeking, depending on market structures and how firms adapt to it thanks to their productive resources (Penrose, 1959; Nelson and Winter, 1982; Teece, 2006). However, some differences emerge when it comes to the origin of the productive resources that raise growth. Considering an industrial market structure, evolutionary approaches describe innovations as a source in favour of the emergence of "path dependencies" (because of lock-in effects and suboptimal behaviours on the market and inside organisations) affecting innovativeness inside organisations. In fact, even minor exogenous shocks may affect the occurrence of a particular path, changing the structure of a given competitive model. This paper examines with two-stage least squares method economic performance's impact on the persistent dynamics of innovation inside the French industry using two waves of community surveys starting from 2002. It appears that the more firm growth raises (at upper quantiles), the more innovativeness increases, and rises above the medium rate when the productive opportunity of the firm is not limited within the studied period.