Marotta, DanielaMark, MichaelBlom, AndreasThorn, Kristian2012-06-082012-06-082007-12https://hdl.handle.net/10986/7558A firm's absorptive capacity, human capital and linkages with knowledge institutions have been shown to increase the firm's probability of innovating in OECD economies. Despite its importance for national- and firm-level competitiveness, few papers examine the impact of the same variables for firms innovation in Latin America. This paper investigates the link between firm innovation and its absorption capacity as proxied by the presence of a R&D department, the firm's human capital, and its interaction with research centers and universities. We analyze the case of Chilean and Colombian manufacturing firms using data from innovation surveys. A probit regression model is applied to identify the determinants of innovation activity. We find that collaboration with university and research institutions is associated with an increase in the probability of introducing a new product in Chilean and Colombian firms of 29 and 44 percent, respectively, and it can increase up to 58 percent in the case of Colombian firms interacting with research centers. Moreover, firms whose employees have a higher level of education, or whose managers/supervisors have a higher (perceived) level of knowledge, are more likely to innovate. Although the estimates could be affected by biases and suffer from shortcomings in data, the findings suggest that policies and incentives to increase firm-level human capital and industry-university linkages are important to increase innovation in Latin America.CC BY 3.0 IGOABSORPTIVE CAPACITYACCOUNTINGAPPROACH TO INNOVATIONCAPABILITIESCAPABILITYCENTERS OF EXCELLENCECOLLABORATIONCOMPETENCIESCOMPETITIVENESSCOMPUTERSCONCEPT OF KNOWLEDGECONCEPTUAL FRAMEWORKCONTINUOUS IMPROVEMENTCURRENT KNOWLEDGEDATA QUALITYDEVELOPMENT ECONOMICSDEVELOPMENT STRATEGIESDISCUSSIONDISSEMINATION OF KNOWLEDGEDOMAINECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC THEORYECONOMICSECONOMICS OF INNOVATIONEMAIL ADDRESSEQUIPMENTEXISTING KNOWLEDGEEXTENSIONEXTERNAL KNOWLEDGEEXTERNAL RELATIONSHIPSEXTERNALITIESFIRM PERFORMANCEFIRM-SPECIFIC KNOWLEDGEFOOD PROCESSINGGEOGRAPHY OF INNOVATIONGLOBAL COMPETITIVENESSGOVERNMENT POLICYHUMAN CAPITALHUMAN RESOURCESIDEAIDEASINCOMEINDIVIDUAL FIRMSINDUSTRIAL POLICYINDUSTRIAL STRUCTUREINFORMATION TECHNOLOGYINNOVATIONINNOVATION CAPACITYINNOVATION INDICATORSINNOVATION INPUTSINNOVATION OUTCOMEINNOVATION OUTCOMESINNOVATION OUTPUTSINNOVATION PERFORMANCEINNOVATION POLICYINNOVATION PROCESSINNOVATION PROCESSESINNOVATION PROGRAMINNOVATION SURVEYSINNOVATION SYSTEMINNOVATION SYSTEMSINNOVATION THEORYINNOVATIVE ACTIVITIESINNOVATIVE ACTIVITYINNOVATIVE CAPACITYINNOVATIVE COMPARATIVE ADVANTAGEINNOVATIVE FIRMSINNOVATIVE OUTPUTINNOVATIVE PERFORMANCEINNOVATIVE PROCESSESINNOVATIVE PRODUCTSINSTITUTIONAL FRAMEWORKINTANGIBLE ASSETSINTELLECTUAL PROPERTYINTERACTIVE LEARNINGINTERNATIONALISATIONINTERRELATIONSHIPSKNOWLEDGE CENTERSKNOWLEDGE DIFFUSIONKNOWLEDGE DISSEMINATIONKNOWLEDGE FLOWKNOWLEDGE FRONTIERKNOWLEDGE INFRASTRUCTUREKNOWLEDGE MANAGEMENTKNOWLEDGE PRODUCTIONKNOWLEDGE SPILLOVERSKNOWLEDGE TRANSFERLABOR FORCELATIN AMERICANLEARNINGLEVEL OF KNOWLEDGELICENSESLOCALIZATIONMANUFACTURINGMANUFACTURING INDUSTRIESMANUFACTURING INDUSTRYMARKET SHAREMARKETINGMISSING VALUEMISSING VALUESNATURAL RESOURCESNETWORKSNEW MARKETNEW PRODUCTNEW PRODUCTSNEW TECHNOLOGIESNEW TECHNOLOGYORGANIZATIONAL CHANGEORGANIZATIONAL MANAGEMENTPOLICY FRAMEWORKPRIVATE SECTORPRIVATE SECTORSPROCESS INNOVATIONPROCESS INNOVATIONSPRODUCT DESIGNPRODUCT INNOVATIONPRODUCT INNOVATIONSPRODUCTION PROCESSESPRODUCTIVITYPUBLIC INSTITUTIONSR&DRADIOREGIONAL DEVELOPMENTREGIONAL INNOVATIONRESULTRESULTSSAFETYSKILLED LABORSKILLED WORKERSSOCIAL KNOWLEDGESOURCES OF INFORMATIONSUCCESSFUL INNOVATIONSUPPLIERSSYSTEM OF INNOVATIONTACIT KNOWLEDGETECHNICAL KNOWLEDGETECHNOLOGICAL DEVELOPMENTTECHNOLOGICAL INNOVATIONTELEVISIONTHINKINGTIME PERIODTOP MANAGEMENTTRANSACTIONTYPE OF KNOWLEDGEUNIVERSITIESUTILITY MODELSVALUE CHAINWEBWOODWORK EXPERIENCEWorld Bank10.1596/1813-9450-4443