Some reasons for innovative duality among Argentine productive sectors

Abstract

The objective of this paper is to study and try to understand the main causes that determine innovative duality in the Argentine tradable sector with a radically different approach. First, it will not employ econometrics to find out innovation’s macroeconomic and microeconomic main obstacles, picking the latter up from published studies and, fundamentally, from Innovation Surveys. Secondly, this paper will analyze how the most innovative dynamic local sectors have surpassed mentioned hurdles, scheme in which the different farming activities’ experiences shall become significantly illuminating. Consequently, this methodology will sacrifice econometric robustness in order to gain, hopefully, explanatory richness. This study’s main result states that least innovative activities, like (medium)high-tech industrial branches and apple and beef productions, have had neither the size nor the articulation with other agents necessary to surpass macro and micro barriers. In this regard, successful studied local experiences reveal that a strategy to increase innovation in the former should have two components. On the one side, a macroeconomic context that affects favorably Argentine tradable firm’s profit margins constitutes a necessary (although not sufficient) condition for a strong innovative dynamics in mentioned firms. On the other side, the study of the soybean case, in particular, and other successful innovative activities, in general, provide evidence regarding microeconomics factors required to complement macroeconomics in order to boost innovative investment within domestic agriculture and industry. Specifically, the former reveal that innovation is usually not an individual behavior’s result, but a collective processes’ consequence. In studied experiences, the own agents’ (farmers, suppliers, clients and private organizations) coordination was enough to promote innovation. Contrarily, in (medium)high-tech manufacturing activities and beef and apple production, firms have not been able to surpass obstacles by themselves and, therefore, State’s presence becomes imperative to tackle the most severe innovative restrictions.