Research and Development, Innovation, Training, Quality and Profitability: Evidence from France

ERMES Working Paper No. 04-11

23 Pages Posted: 29 Dec 2004

See all articles by Fabrice Galia

Fabrice Galia

Burgundy School of Business (ESC Dijon), France - CEREN - Research Center on Enterprises - Management Department; Universite Pantheon-Assas Paris II - ERMES-UMR 7181-CNRS

Diego Legros

Université Paris II - Panthéon-Assas - ERMES

Date Written: 2004

Abstract

This paper simultaneously explores the firm-level relationships between R&D investments, innovation, training investments, quality and firm performance. It offers empirical evidence on how innovation, training and quality affect firm profitability. One new feature we introduce is the link between training and quality. Using asymptotic least square, we estimate a five-equation model including censored, dichotomous and linear variables with a specific circular scheme. The data are from the French innovation survey combined with firm-level register data. This allows us to consider a number of training and quality related variables which are usually neglected in the literature. While traditional determinants are controlled for, our results show there exists a virtuous circle. Our results are also in line with a number of stylized facts.

Keywords: R&D, innovation, training, quality, profitability, limited dependent

JEL Classification: C31, C34, L60, O31, O33

Suggested Citation

Galia, Fabrice and Legros, Diego, Research and Development, Innovation, Training, Quality and Profitability: Evidence from France (2004). ERMES Working Paper No. 04-11, Available at SSRN: https://ssrn.com/abstract=633973 or http://dx.doi.org/10.2139/ssrn.633973

Fabrice Galia

Burgundy School of Business (ESC Dijon), France - CEREN - Research Center on Enterprises - Management Department ( email )

29 rue Sambin
21006 Dijon
France
+33 (0)3 80 72 59 40 (Phone)
+33 (0)3 80 72 59 99 (Fax)

HOME PAGE: http://www.burgundy-school-of-business.com/en/faculty/meet_detail.asp?prof=f_galia_ceren

Universite Pantheon-Assas Paris II - ERMES-UMR 7181-CNRS ( email )

12, Place du Panthéon
75 230 Paris, Cedex 5
France
+33 (0)1 44 41 89 68 (Phone)
+33 (0)1 40 51 81 30 (Fax)

HOME PAGE: http://www.u-paris2.fr/ermes/membres/galia/galia.htm

Diego Legros (Contact Author)

Université Paris II - Panthéon-Assas - ERMES ( email )

12 Place du Panthéon
Paris, Cedex 5, 75005
France
+33 1 4441 8991 (Phone)
+33 1 4051 8130 (Fax)

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