Innovation in Brazilian SME firms X governmental financial grants

Abstract

Small and medium enterprises (SMEs) play an important role in the context of economy impact, growth and development. Moreover, there is an acknowledgement of the function of SMEs in the field of sustaining global and regional economic recuperation: The World Bank Review on Small Business Activities invests in the development of the small and medium enterprise sector in order to nurture economic growth, employment and poverty mitigation. Innovation is also crucial for the development of new technologies and processes that allow companies to have productivity growth and competitive advantage gains. Following these perspectives, this study aims to examine the role of governmental funds in the innovation process of Brazilian SMEs, with a focus on the aspects that involve the company’s path of innovation, and to examine whether the fund has played an important function in boosting and sustaining innovative capabilities. The scope of the study constitutes three different small/medium Brazilian companies that have received financial aid from the Brazilian National Bank of Development (BNDES) in order to support the development of innovative projects.