Keywords: food and beverage and tobacco industry, innovation, industrial economy, resources and capabilities, Spain
Innovation in the Spanish food and beverage industry: an integrated approach
This paper examines the contributing factors to the innovation process in the Spanish food and beverage industry. We present a model that integrates the theory of industrial economy and the theory of resources and capabilities; this model explains that technological innovation at a firm level is affected by environmental and firm internal factors. We also analyse the investment in R&D and the probability of generating process or product innovations, independently of whether or not the companies invest in R&D. The empirical analysis shows that internal and external factors affect investment in R&D but only internal factors are related with innovation performance. The main conclusion is that neither external factors nor R&D expenditure influence the probability that a company generates innovations. We argue that there are two reasons to conclude this. Firstly, the Spanish food and beverage industry generates product differentiation innovations. These kinds of innovations do not require large R&D investments. On the other hand, the sector incorporates other industries' advances in research, so it could be considered a free rider. Consequently, the food and beverage industry in Spain needs internal capabilities to adapt the mentioned external knowledge.