| Pub. Date | : Jan, 2024 |
|---|---|
| Product Name | : The IUP Journal of Accounting Research and Audit Practices |
| Product Type | : Article |
| Product Code | : IJARAP060124 |
| Author Name | : Abhishek Kumar Sinha, Aswini Kumar Mishra, Abhay Kumar, Bhanu Sireesha and Nityanand Tripathi |
| Availability | : YES |
| Subject/Domain | : Finance |
| Download Format | : PDF Format |
| No. of Pages | : 23 |
The paper employs Probit Regression Model for small and medium enterprises (SMEs) to investigate the relationship between 'access to finance' and 'type of innovation', using firm-level dataset from the World Bank Enterprise Survey, covering 7,165 manufacturing firms from 23 states in India. The study indicates that 'access to finance' has a significant effect on the probability of firms' decision to innovate. It is also significantly associated with the likelihood of firms' decision to adopt a particular type of innovation, such as Product Innovation, Process Innovation, Organizational Innovation and Marketing Innovation. Several other structural characteristics of the firm are found to have significant effects on the innovation decision. The study would be of help to managers to understand how SMEs conduct their innovation decision process in response to the severity of obstacles to access to finance.
Are certain types of firms more innovative than others? How are different types of innovation associated with firm size, age, export intensity, location and industry sector? Is access to external finance associated with innovation-decision, and is this association stronger for certain types of innovation? Are firms with a foreign presence more/less innovative than other firms?