The literature on innovation studies has extensively examined the main drivers of innovation activity, while putting less attention on factors that are crucial in order to foster competition dynamics, as well as to attenuate systemic failures to innovation. This paper aims to filling this gap by distinguishing between firms facing deterring barriers to innovation (i.e. those barriers that deter firms from engaging in innovation activities) and firms confronting revealed barriers (i.e. those barriers that are experienced by firms alongside their engagement in innovative activities). Drawing upon the literature on innovation studies, we propose a set of hypotheses on which factors are likely to attenuate deterring and/or revealed barriers to innovation (e.g. firm size, firm age, human capital, etc.). We built a longitudinal dataset derived from four waves of the Spanish Innovation Survey (2004-2007) in order to examine the impact of the proposed factors on three types of obstacles to innovation: cost, knowledge and market barriers. Results reveal that: first, knowledge and market related obstacles play a much stronger role as deterring barriers than cost-related obstacles; second, firm size and human capital available at firms play a significant role in attenuating deterring barriers to innovation, though only the former has a significant impact on alleviating revealed barriers.
