Nature and impact of innovation in manufacturing industry: some evidence from the Italian innovation survey

Using data on more then 22,000 manufacturing firms participating to the second Italian Innovation Survey, fresh evidence is presented on the number of firms involved in innovation, the total expenditures devoted to innovation and the quantity and quality of innovating output. The most important innovation expenditures are investment in new machinery and R&D. The existence of major cross-industry differences are however confirmed, Within the group of innovating firms, the small ones do not emerge less innovative than the large ones. However, data clearly show that small firms introducing innovations are a minority and that they account for only a small share of total innovation expenditure of the Italian manufacturing industry. The paper also quantifies the share of new products and processes on total sales showing that a substantial part of sales in the manufacturing industry (62%) is made of unchanged products and processes and only 1.2% of total sales is made of entirely new products. It is also shown that only to a limited extent the innovation patterns highlighted in this article reflect the peculiar characteristics of Italian industrial structure. Most of them are common to most of the European countries which have taken part to the Community Innovation Survey (CIS). (C) 1997 Elsevier Science B.V.