The effect of technological innovation on low-tech Peruvian manufacturing firms' performance: the role of external sources of knowledge

Abstract

PurposeThis paper aims to evaluate the relationship between external sources of knowledge and technological innovation and then analyze how technological innovation improves firm performance.Design/methodology/approachThis study presents evidence based on a sample of 708 low-tech firms that participated in the National Survey of Innovation in the Manufacturing Industry and Knowledge-Intensive Service Firms (ENIIMSEC). A structural equation model approach was applied in this study.FindingsThere is a positive relationship between external sources of knowledge and technological innovation; technological innovation improves firm performance.Originality/valueThese results provide a deeper knowledge about how manufacturing firms in an emerging economy can apply open innovation practices to develop technological innovation, thus improving the firms' performance.