No. 197 - Italian firms’ innovation strategies in 2008-2010

The paper describes the innovation strategies (R&D) of a representative sample of Italian firms participating in the Bank of Italy's yearly survey (Invind). The evidence covers the period from 2008 to 2010 and highlights some stylized facts widely discussed in the economic literature. The results show that R&D activity is carried out within the firm and is basically self-financed. External sources of financing, such as financial intermediaries, venture capitalists and state subsidies, play a very limited role. The latter do not seem to determine the decision to invest in R&D, but they are correlated with the investment intensity. R&D is more intense among bigger firms established in central and northern Italy. Managerial best practices tend to be positively associated with R&D expenditure and only to a lesser extent with firms' ability to produce innovation. Moreover, exporting firms have a higher propensity both to invest in R&D and to patent their intellectual property. Finally, the survey shows that the biggest obstacles to innovation for Italian firms are high setup costs and a lack of skilled research personnel.