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Abstract

Cluster-based industrial development has been pursued by policymakers in India. It emphasised an innovation-led path to development because of its potential of generating high-quality and technologically advanced jobs with decent wages. Continuous innovation is one of the main factors which can sustain competitive advantage in small and medium enterprises (SMEs). Hence in this article, we study how innovation frequency is influenced by various factors such as entrepreneurial characteristics, firm and its linkages with various stakeholders. The study was conducted among 160 randomly selected SMEs from the database of primary Association of Ambattur Industrial Cluster Members, AIEMA-Ambattur Industrial Estate Manufacturers Association. Primary data was collected through a structured questionnaire given to the decision-makers of each SME unit. Multinomial logistic regression was carried out on the data with innovation frequency as the dependent variable. The result of the study showed that factors such as entrepreneurial intention, entrepreneur type, firm’s life cycle, firm’s age, firm’s investment level and linkage with research institutions have a highly significant effect on innovation frequency and factors such as entrepreneur education, firm’s ownership structure, industry type, firm’s size and linkages with customers, government, universities, technical institutions also have a positive significant effect of increasing the innovation frequency.

Keywords

Cluster development Entrepreneurship Innovation management Strategy management and Technology

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Determinants of Innovation Frequency in SMEs: Evidence from Ambattur Industrial Cluster

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