Innovation inputs and efficiency: manufacturing firms in Sub-Saharan Africa

Abstract

Purpose-Countries in Africa have a common goal policy of industrialisation that is expected to be driven by investing in innovation that yields efficiency. The purpose of this paper is to investigate the technical efficiency effects arising from innovation inputs including internal R&D, human capital development (HCD), and foreign technology adoption in manufacturing firms in Africa. Design/methodology/approach-This study uses cross-sectional firm-level survey data from the 2013 World Bank Enterprise Survey and the linked 2013 Innovation Follow-up Survey. A heteroscedastic half-normal stochastic frontier is used for analysing the technical efficiency effects of innovation inputs of 418 firms. Findings-This study reveals that internal R&D, and foreign technology have negative effects on technical efficiency. Notwithstanding, the combination of foreign technology and internal R&D, and foreign technology and HCD reinforce each other's effects on technical efficiency. Practical implications-This study provides evidence that whereas individual innovation inputs may not yield positive efficiency outcomes, the combination of absorptive capacity enhancing inputs comprising internal R&D and HCD with foreign technology is vital for enhancing technical efficiency in manufacturing firms in Africa. This study offers important lessons for managers in manufacturing firms in Africa. Originality/value-This study is virtually the first to investigate the relationship between innovation inputs and efficiency in Africa. This study demonstrates that investing in foreign technology in isolation from absorptive capacity enhancing innovation inputs diminishes efficiency. HCD and internal R&D are imperative for building absorptive capacity that enhances efficiency outcomes arising from foreign technology.

Closing the gap: Gender and innovation

“…About 48 per cent of the firms were categorized as mature firms. The age of the sampled firms is consistent with that of previous studies in the context of sub-Saharan Africa (Barasa 2018;Barasa et al 2019). In addition, 63 per cent of firms were medium-sized enterprises.…”

Leveraging industrial-technological innovation to achieve sustainable development: A systems thinking perspective

“…Literature sources technological breakthroughs [44] management level [27,45] resource reserves [26] agglomeration spillovers [3] policy assistance [46] industrial transfer [28] market demand [21] https://doi.org/10.1371/journal.pone.0242981.t001…”

“…In addition, abundant resource reserves provide powerful support for innovative activities [ 52 ]. Conversely, in the absence of support resources, the quality and speed of ITI will be limited, resulting in poor operation of the entire system [ 26 ].…”

“…Li [ 24 ] studied the data of 30 projects and found that ITI reduces industrial energy consumption and pollutant emissions, and provides a basic guarantee for sustainable industrial development. Other studies have examined the static impact of factors such as optimizing resource allocation [ 25 ], increasing innovation input [ 26 ], implementing scientific management [ 27 ], and integrating innovation clusters [ 28 ]. However, the literature has ignored the dynamic correlations and systematic relationships between related factors.…”

Pekerja Efektif dan Kecekapan Teknik Firma Pembuatan di Malaysia

“…Pembangunan modal manusia berkualiti tinggi selain berupaya mencetuskan idea dan inovasi dan penciptaan teknologi juga sangat signifikan dan merupakan penentu kepada kecekapan teknik firma (Barasa et al 2019;Na-Qian Deng et al 2018;Deraniyagala 2001;Alvarez & Crespi 2003). Tahap penggunaan teknologi dalam proses pengeluaran firma secara langsung akan menentukan tahap kecekapan teknik firma termasuk di Malaysia (Mohd Fahmy et al 2017;Zulridah & Rahmah 2007;Mahadevan & Mansor 2007).…”