Table 7

Testing H3: process innovation is positively associated with firm growth

Dependent variable: average CAGR from 2015 to 2019
Regression type variablesIV regression (1)IV regression (2)IV regression (3)IV regression (4)IV regression (5)FE-IV regression (6)
Sustainability0.07***0.09***0.03**0.04***0.04***0.03***
(0.03)**(0.06)**(0.02)**(0.02)***(0.01)**(0.02)**
Innovation −0.02***    
 (0.03)**    
Size of the firm  0.03***0.03***0.03***0.02***
  (0.01)**(0.01)**(0.01)***(0.00)**
Constant−0.19***−0.19***−0.12***−0.17***0.17***−0.14***
(0.09)**(0.11)**(0.06)**(0.06)**(0.06)**(0.07)**
Instrumented withFormalized sustainability + innovationFormalized sustainability + process innovation + product innovationFormalized sustainability + product innovationFormalized sustainability + process innovationFormalized sustainability + process innovationFormalized sustainability + process innovation
S.E.Clustered at sector levelRobust
FENONONONONOYES
Observations143141142142142142
Number of sectors     5
Wald-Chi2OKNot significantOKOKOKOK
Endogeneity testOKFailedFailedOK∼ OK/
Significance of first stageOKFailedOKOK∼ OK/
Overidentification testOKFailedOKOK//

Note(s): Standard errors in parentheses and *p < 0.1; **p < 0.05; ***p < 0.01

Source(s): Authors' work
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