The Impact of Technological Innovation on the Performance of Vietnamese Firms

Technological innovation applied in production processes, product quality, and new product expansion contributes to changing firm performance. Thus, this study was conducted to investigate the impact level of technological innovation on financial performance of Vietnamese firms. Data was collected from 8,960 firms for the period of 2015-2018. Pooled OLS, FEM, and REM were employed for processing data. The results showed that there was not enough evidence to state that technological innovation influences firm performance of small and medium firms but significant impacts were found on the performance of medium and large firms. The findings also illustrated that regional determinants affect technological innovation of firms in emerging countries in general and in Vietnam in particular. The results of this research imply that successful firms are constantly creating and distributing new technological innovation and rapidly applying it to new technologies and products to have a better performance.