Patterns in the Innovative Activities of Ghanaian Manufacturing and Services Firms

r4d Working Paper 2016/8 by Agyapomaa Gyeke-Dako, Abena Daagye Oduro, Ebo Turkson, Priscilla Twumasi Baffour, Emmanuel Nii Abbey

ABSTRACT: Innovative activities of firms differ with respect to their orientation, intensity, use of internal and external knowledge as well as the factors that necessitated the innovation. Using firm-level data for Ghana, an attempt was made to describe patterns in the innovative activities of Ghanaian Manufacturing and Services firms based on a cluster analysis of some innovation measures. The main aim was to establish which innovative activities were widespread, identify which types of firms tend to be more innovative and ascertain the basic determinants of innovation along any established pattern. Without a proper understanding of these issues, policy makers may easily be misled or made to divert relevant innovation policy away from the needs of firms that needed them the most. The exercise yielded three innovation clusters (patterns), which were characterised by some firm specific-information. One main finding of the study is the establishment of low correspondence between firms that shared similar innovation characteristics (clusters) and sectors. This suggests individual firms seem to dispose of a certain degree of freedom in selecting economically viable innovation strategies even under similar economic and/or technological conditions. More importantly, results from the study suggests that some underlying firm-specific microeconomic processes overcome pressures in the technological nvironment towards homogenous behaviour by firms, even in the same sector.