Dr. Elvis Avenyo

Innovation and firm performance in developing countries

Year: 2018

Pierre Mohnen & Maty Konte


Recent decades have seen a rise in optimism with regards to the sustainable economic prospects of sub-Saharan Africa through innovation. This thesis focuses on the empirical analyses of innovation activities of firms in sub-Saharan Africa, with specific emphasis on the innovation process, the market performance of new products and the labour market impact of new products. The novelty of the thesis comes from the duality perspective, where it departs from mainstream views of development economics, by considering innovations in both formal and informal firms. The results suggest that firm product innovations offer unique opportunities to resolve key socio-economic challenges, such as employment creation and competitiveness, Africa faces today. These results are valid irrespective of the registration status – formal and informal – of firms.

Chapter 2 investigates the impact of product innovations on total employment. The main finding is consistent with the stylised fact in the empirical literature, with product innovations having compensation impact on total employment. In extension to decent employment, we found that product innovation is biased towards temporary employment, though it creates both permanent and temporary jobs. Chapter 3 examines the relationship between informal competition and sales from innovative products introduced by formal firms. The results reveal a robust ‘Schumpeterian effect’ of informal competition on the market performance of product innovations. Besides, through indirect mechanism, firms with larger market share tend to have ‘escape-competition effects’. We argue that informal competition matters for the performance of product innovations, but only for formal firms that lack strategic collaborative ‘footholds’ in the informal economy. Chapter 4 describes the data collection procedure, followed by descriptive statistics of enterprise-level data collected in urban Ghana (Accra and Tema). The descriptive statistics indicate that innovations are pervasive in the informal economy of Ghana, with informal enterprises generating innovative ideas internally. Chapter 5 investigates the effects of learning processes –apprenticeship and formal interactions – on the innovation activities of informal enterprises in Ghana. The findings suggest that both apprenticeship and competitive formal interactions enhance product innovativeness.

Selected publications by Elvis Avenyo

Articles (journal, professional, popular)
Avenyo, Elvis, John Nana Francois & Tatenda Zinyemba, 2021, `On gender and spatial gaps in Africa’s informal sector: Evidence from urban Ghana, Economic Letters, 199, More information
Avenyo, Elvis, Maty Konte & Pierre Mohnen, 2021, `Product innovation and informal market competition in sub-Saharan Africa, Journal of Evolutionary Economics, 31, More information
Avenyo, Elvis, Maty Konte & Pierre Mohnen, 2019, `The employment impact of product innovations in sub-Saharan Africa: Firm-level evidence, Research Policy, 48, More information

UNU-MERIT Working Papers
Avenyo, Elvis, John Nana Francois & Tatenda Zinyemba, 2020, COVID-19, Lockdowns, and Africa’s Informal Sector: Lessons from Ghana, UNU-MERIT Working Paper 2020-028
Balde, Racky, Mohamed Boly & Elvis Avenyo, 2020, Labour market effects of COVID-19 in sub-Saharan Africa: An informality lens from Burkina Faso, Mali and Senegal, UNU-MERIT Working Paper 2020-022
Avenyo, Elvis, Maty Konte & Pierre Mohnen, 2019, The employment impact of product innovations in sub-Saharan Africa: Firm-level evidence, UNU-MERIT Working Paper 2019-019
Ndubuisi, Gideon & Elvis Avenyo, 2018, Estimating the effects of robotization on exports, UNU-MERIT Working Paper 2018-046
Avenyo, Elvis, 2018, Informal sector innovation in Ghana: Data set and descriptive analysis, UNU-MERIT Working Paper 2018-030
Al Raee, Mueid, Elvis Amoateng, Elvis Avenyo, Youssef Beshay, Mira Bierbaum, Charlotte Keijser & Rashmi Sinha, 2014, Millennium Development Goals: Tool or token of global social governance?, UNU-MERIT Working Paper 2014-024

External working papers
Torres Mazzi, Caio, Gideon Ndubuisi & Elvis Avenyo, 2020, Exporters and global value chain participation: Firm-level evidence from South Africa, More information
Avenyo, Elvis & Gideon Ndubuisi, 2020, Coping During COVID-19: Family Businesses and Social Assistance in Nigeria, The COVID-19 pandemic and the consequent Government-imposed restrictions have altered the way of life around the globe. Using the newly “Nigeria Baseline COVID-19 National Longitudinal Phone Survey 2020”, this paper contributes to the nascent literature on the Economics of COVID-19 by examining the impact of changes in income and social assistance due to the pandemic on the coping strategies of family business owners. We find that family business owners who experienced a reduction in income and those that received social assistance due to the pandemic are likely to increase their coping level. We discuss the policy implications of these findings, More information

Avenyo, Elvis, 2018, Innovations and firm performance in sub-Saharan Africa: Empirical analyses, PhD dissertation Maastricht University / United Nations University