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Innovation and the Survival of New Firms in the UK

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Abstract

This paper analyzes the survival over the subsequent 5-year period of the complete cohort of nearly 162,000 limited companies that incorporated in Britain in 2001. The paper focuses on the relationship between innovation and survival at the firm-level. The data available allow us to look at the intellectual property (IP) activity of all British firms, including that of the cohort of new firms in 2001. The results indicate that IP activity, measured as patenting and trade-marking, is associated with a considerably lower probability of exit. We also find substantial differences in survival probabilities across sectors. In some sectors patenting is associated with a lower probability of exit; however, trade-marking is associated with lower probability in almost all sectors.

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Authors and Affiliations

  1. Wolfson College, University of Oxford, Linton Road, Oxford, OX2 6UD, UK

    Christian Helmers

  2. Harris Manchester College, University of Oxford, Mansfield Road, Oxford, OX1 3TD, UK

    Mark Rogers

  3. Aston Business School, Aston University, Birmingham, UK

    Mark Rogers

Authors
  1. Christian Helmers
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  2. Mark Rogers
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Corresponding author

Correspondence to Mark Rogers.

Additional information

We acknowledge substantive comments from the editor, Lawrence White, and an anonymous referee. We also benefitted from comments from Marcel Fafchamps, Catherine Roux, participants in seminars at Aston Business School, Kiel Institute, London Business School, participants to the 10th Summer Workshop for Young Economists at ZEW Mannheim, and the 35th Conference of the EARIE.

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Helmers, C., Rogers, M. Innovation and the Survival of New Firms in the UK. Rev Ind Organ 36, 227–248 (2010). https://doi.org/10.1007/s11151-010-9247-7

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