Maria Cristina Longo, Calogero Guccio, Marco Ferdinando Martorana
{"title":"Being innovative is not enough: a semi-parametric assessment of the efficiency of post-incubation innovative firms","authors":"Maria Cristina Longo, Calogero Guccio, Marco Ferdinando Martorana","doi":"10.1108/ejim-06-2023-0475","DOIUrl":null,"url":null,"abstract":"<h3>Purpose</h3>\n<p>This paper aims to assess whether incubation affects the technical efficiency of innovative firms after entering the market. The study of efficiency allows firms to understand how well resources have been used in production processes. The research intends to contribute to the literature on the performance of incubated firms.</p><!--/ Abstract__block -->\n<h3>Design/methodology/approach</h3>\n<p>This study estimates the relative efficiency of innovative firms adopting a DEA-based two-stage semi-parametric method. Incubation, firm age and initial capital are used for explaining the relative performance of previously incubated firms compared to non-incubated ones over a six-year period of activity. This research focuses on Italian innovative firms using a large sample of companies.</p><!--/ Abstract__block -->\n<h3>Findings</h3>\n<p>Results show that incubators have a positive and significant effect on efficiency for firms that have been in the market for more than two years. Efficiency also improves with age and with the level of initial capital of the firm.</p><!--/ Abstract__block -->\n<h3>Research limitations/implications</h3>\n<p>This analysis is limited to the quantitative dimension of inputs as reported in the balance sheets, without qualitative considerations.</p><!--/ Abstract__block -->\n<h3>Practical implications</h3>\n<p>Findings enhance firms' understanding of the role of incubators as neutral places to develop a business culture of efficiency. From an empirical standpoint, this study provides useful insights to start-uppers who intend to attend incubation programs. Overall, incubators matter to the extent that they enable new firms, net of those that fail to survive in the first two years of activity, to improve their efficiency in the use of inputs. This research also suggests incubators consider the start-ups’ potential of being efficient.</p><!--/ Abstract__block -->\n<h3>Social implications</h3>\n<p>Findings provide tips to policymakers when they are called upon to propose funding programs to support prominent firms entering the business scalability.</p><!--/ Abstract__block -->\n<h3>Originality/value</h3>\n<p>This study contributes to the literature on the relative performance of post-incubated firms, highlighting the efficiency frontier analysis. This methodological approach is relatively new in this field. It allows researchers to study the innovative firms' performance in relative terms, that is with respect to the input level. It integrates the performance-based with efficiency frontier analysis. Also, this study reinforces the idea that incubators prepare start-ups to develop capacities and managerial skills, which will be useful in post-incubation life to improve their cost competitiveness.</p><!--/ Abstract__block -->","PeriodicalId":51462,"journal":{"name":"European Journal of Innovation Management","volume":"5 1","pages":""},"PeriodicalIF":5.0000,"publicationDate":"2023-12-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"European Journal of Innovation Management","FirstCategoryId":"91","ListUrlMain":"https://doi.org/10.1108/ejim-06-2023-0475","RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
Purpose
This paper aims to assess whether incubation affects the technical efficiency of innovative firms after entering the market. The study of efficiency allows firms to understand how well resources have been used in production processes. The research intends to contribute to the literature on the performance of incubated firms.
Design/methodology/approach
This study estimates the relative efficiency of innovative firms adopting a DEA-based two-stage semi-parametric method. Incubation, firm age and initial capital are used for explaining the relative performance of previously incubated firms compared to non-incubated ones over a six-year period of activity. This research focuses on Italian innovative firms using a large sample of companies.
Findings
Results show that incubators have a positive and significant effect on efficiency for firms that have been in the market for more than two years. Efficiency also improves with age and with the level of initial capital of the firm.
Research limitations/implications
This analysis is limited to the quantitative dimension of inputs as reported in the balance sheets, without qualitative considerations.
Practical implications
Findings enhance firms' understanding of the role of incubators as neutral places to develop a business culture of efficiency. From an empirical standpoint, this study provides useful insights to start-uppers who intend to attend incubation programs. Overall, incubators matter to the extent that they enable new firms, net of those that fail to survive in the first two years of activity, to improve their efficiency in the use of inputs. This research also suggests incubators consider the start-ups’ potential of being efficient.
Social implications
Findings provide tips to policymakers when they are called upon to propose funding programs to support prominent firms entering the business scalability.
Originality/value
This study contributes to the literature on the relative performance of post-incubated firms, highlighting the efficiency frontier analysis. This methodological approach is relatively new in this field. It allows researchers to study the innovative firms' performance in relative terms, that is with respect to the input level. It integrates the performance-based with efficiency frontier analysis. Also, this study reinforces the idea that incubators prepare start-ups to develop capacities and managerial skills, which will be useful in post-incubation life to improve their cost competitiveness.
期刊介绍:
The subject of innovation is receiving increased interest both from companies because of their increased awareness of the impact of innovation in determining market success and also from the research community. Academics are increasingly beginning to place innovation as a priority area in their research agenda. This impetus has been partly fuelled by the Economic & Social Research Council (ESRC) who have designated innovation as one of nine research areas in their research initiative schemes.