Persistence of Firm Innovative Behavior : Towards an Evolutionary Theory

The persistence of firm innovative behaviour became an important topic in applied industrial organization following publication of the seminal work of P. Geroski et al. (1997). Knowledge that few firms innovate persistently led previous studies to focus on the determinants of persistence and on its heterogeneity across industries, technologies and countries. While considerable empirical evidence on the phenomenon has been gathered, no systematic theoretical framework has yet been suggested for understanding persistence in innovation. This paper sets out arguments in favour of an evolutionary competence/capability approach to the phenomenon of persistence in innovation. The paper provides definitions of terms and attempts to establish the importance of restoring persistence in innovation to Schumpeterian modeling of industrial dynamics. Next is a survey of the principal empirical works on the subject. Then an evolutionary theory of firm innovative persistence is presented. Finally a formal model of persistence is outlined