Barriers and Limitations in the Development of Industrial Innovation in the Region

11

Strategically, Israel concentrate in its industrial development on R&D, especially in the hi-
tech sector (Roper and Frenkel, 2001). This policy had lead to the development of R&D
services in great extent, thereby reduced to the minimum this barrier.

All the others eight factors from the presented list hardly influence the ability to innovate. The
insignificant that ascribed to the lack of R&D services as hindering the ability of the firms to
innovate was expected. The important role that R&D services play in contributing to the
engagement of the firms in developing innovation documented in different studies (see for
example: Frenkel 2000; Frenkel et al., 2000, 2001; Roper and Love, 1996; Dosi, 1988;
Rosenberg, 1985; Nelson, 1986). Strategically, Israel concentrate in its industrial development
on R&D, especially in the hi-tech sector (Roper and Frenkel, 2001). This policy had lead to
the development of R&D services in great extent, thereby reduced to the minimum this
barrier.

In order to find the differences between the metropolitan region and the periphery in
accordance with the limitation factors, a Mann-Whitney a-parametric model was conducted.
The results obtained from the model (see Table 1) identified 7 factors in the list in which the
differences ascribed to them by the firms’ directors were statistically significant. However,
just only one factor belong to the first priority group and another to the medium level priority
group. These are the lack of skilled personal and the lack of information on market
opportunities. Figures 1 and 2 present the distribution of firms according to the level of
importance they ascribed to these two barriers, in comparison between metropolitan area and
the peripheral zone.

Figure 1: Distribution of firms (⁰%) according to the importance they ascribed to the lack of
skilled personal as a barrier to innovation, by regions

□ metropolitan         □ periphery

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