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Does the innovativeness of creative firms help their business clients to innovate?

Abstract

This paper aims to enlarge our understanding of how the creative industries affect an economy’s innovation activities both by developing and introducing innovations as part of their business activities and stimulating innovation in other sectors. It applies a two-stage analysis. As to the first stage, it attempts to identify the innovation determinants of creative firms considering several characteristics of their founders and employees and different types of knowledge sources. In the second stage, the paper seeks to explore whether and how creative firms’ innovative output helps their business clients from other (creative or non-creative) industries to innovate accounting for endogeneity issues. Our analysis is based on more than 1000 firms operating in various creative industries in 5 European countries (Italy, UK, Sweden, Denmark, Greece). The main findings in the first stage of the analysis suggest that younger founders and employees with creativity expertise are significantly associated with an increased probability of creative firms introducing both product and process innovation. In the second stage of analysis, we provide strong empirical evidence that creative industries support innovation in the wider economy. We show that the innovation output of creative firms constitutes a crucial input for the innovativeness of their business clients from other (creative or non-creative) industries.

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Notes

  1. Creativity for Innovation & Growth in Europe (Cre8tv.eu) research project funded by the EU Seventh Framework Programme. Further information about the project at: http://cordis.europa.eu/project/rcn/106719_en.html.

  2. Moreover, through t-tests we examine whether there are potential differences in the knowledge sources between two groups of creative firms, i.e. the creative firms that their sales depend to a high degree on other business clients operating either in creative industries or other industries (B2B), and the creative firms that their sales depend to a high degree on end-consumers (B2C). Results show that there are no differences between B2B and B2C in the means of knowledge sources that they use. The t-tests are available from the authors upon request.

  3. We would like to thank a referee for this argumentation that explains why in-house R&D may not play a crucial role in the innovativeness of creative industries.

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Acknowledgements

We are grateful for constructive and valuable comments received from two anonymous reviewers and the editor. We would like to thank the Laboratory of Industrial and Energy Economics at the National Technical University of Athens for providing us with the survey data used in our research based on the Creativity for Innovation & Growth in Europe (Cre8tv.eu) research project funded by the EU Seventh Framework Programme. Aggela Dimitropoulou acknowledges funding support from the State Scholarships Foundation (ΙΚΥ). In particular, the PhD research of Aggela Dimitropoulou is co-financed by Greece and the European Union (European Social Fund- ESF) through the Operational Programme “Human Resources Development, Education and Lifelong Learning” in the context of the project “Strengthening Human Resources Research Potential via Doctorate Research” (MIS-5000432), implemented by the State Scholarships Foundation (ΙΚΥ). Aggelos Tsakanikas and Ioannis Giotopoulos acknowledge funding support from the Greek General Secretariat for Research and Technology in the context of the Bilateral Research and Innovation Programme “INNOMSME (On the INNOvativeness of Micro, Small, and Medium Sized Enterprises in Greece and Germany),” within the Greek-German Research Cooperation carried out by the DIW Berlin and the Foundation for Economic and Industrial Research (IOBE).

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Correspondence to Aggela Dimitropoulou.

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Dimitropoulou, A., Giotopoulos, I., Protogerou, A. et al. Does the innovativeness of creative firms help their business clients to innovate?. J Technol Transf (2021). https://doi.org/10.1007/s10961-021-09901-1

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Keywords

  • Creative firms
  • Innovation
  • B2B innovative linkages
  • Founder-specific characteristics
  • Employee-specific characteristics

JEL Classification

  • O31
  • L80