Fostering high-impact innovation: empirical evidence in Europe

The present exploratory research paper delves into the dynamics between external and internal catalysts for innovation and their impact on the profundity of innovation within firms, integrating insights from the disruptive innovation and the resource-based view frameworks. On the one hand, the study examines market competitiveness as an external driver of innovation. On the other, it focuses on firm-level (internal) innovation drivers, particularly those related to patents. This investigation encompasses a large dataset of publicly listed European corporations over the period from 2013 to 2021. The findings indicate a positive relationship between the depth of innovation and certain innovation drivers. Nevertheless, an inverse relationship is identified between the patent’s portfolio and innovation depth, suggesting that a small number of valuable patents, in comparison to the overall patent count, diminishes innovation depth. This paper proposes that future research should examine how the influence of these external and internal drivers on a firm’s innovation depth varies across different sectors and explore the effect of moderating variables on the relationship studied. By offering a general view of the innovation drivers, this research enriches the existing academic literature with novel perspectives.