Obstacles to innovation of colombian firms.

This proposal aims to understand the obstacles to innovation faced by Colombian firms in their innovation activities. In particular, we want to study how obstacles to innovation affect the propensity to innovate, degree of novelty, and persistence of innovation considering firms’ characteristics. We use the Technical Development and Innovation in the Manufacturing Industry (EDIT) survey, which covers the universe of Colombian firms and gathers data from obstacles to innovation during the period 2003 to 2014, with four cross sections of data. We propose to use alternative methods to deal with sample selection of firms and the multi-dimensionality of variables related to obstacles to innovation. We generalize the econometric estimations to innovations of different degree of novelty, exploring possible heterogeneous effects related to innovations that are new to the firm, new to the domestic market, or new to the international market. We also explore whether different obstacles to innovation affect differently heterogeneous firms in terms of sectors of different technology content, type of organization, collaborations, or qualified labor engaged in innovation activities. Moreover, we estimate an econometric model to determine how obstacles affect persistence in innovation at the firm level. In addition to the quantitative analysis, we analyze a case of study to explore how obstacles to innovation have affected firms in the biotechnological sector. Using the estimation results, we make simulations of diverse policy implementations and asses the expected improvements in the rates of innovations by manufacturing firms. Finally, we derive a set of policy recommendations to reduce barriers to innovation based on the empirical analysis, cases of study, and simulations.