Innovation in the Dutch agricultural sector: Determinants on a firm specific level

The aim of this research is to show which determinants of innovation are important in the Dutch agricultural sector, on a firm-specific level. Historically the Dutch agricultural sector is relatively important for the Dutch economy, so in most studies -with respect to innovation- the benefit for the whole economy is taken as a starting point. The importance of innovation for economic progress in general is irrefutable, but is mostly explained on an aggregated level. This research however, focuses on the firm-specific level of analysis. Panel data from the Dutch FADN and in particular the data of the Innovatiemonitor survey, both collected by the Dutch Agricultural Economics Research Institute (LEI), made this research possible. Further, this research aims on providing a framework for important determinants of innovation and more importantly providing basic knowledge of innovation within the different subsectors of the Dutch agricultural sector. Differences between subsectors, profit, firm size, education and age of the farmer, legal forms of farms and connections with external sources of knowledge explain for differences in innovation in the Dutch agricultural sector. In principle there are difference between the most important determinants of product and process innovation; which is explained by the structural difference of these two types of innovation and their different requisites. The model of this research is also a useful prelude for additional, future, research due to the structural differences between the explaining determinants of both product and process innovation.