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Although very dynamic and flexible, Turkish SMEs are less innovative than their European counterparts. The analysis undertaken in this paper allows assessing whether this low level of innovative activities is related to a lack of entrepreneurial behaviour and/or to the weaknesses of the Turkish innovation system. Exploring a unique firm level survey realized among 50,000 small- and medium-sized enterprises, the authors seek to evaluate the impact of firms' behaviour and choices in the presence of entrepreneurial, technological, institutional, and market opportunities, in an emerging country context. The results highlight the importance of policy measures in building innovative capabilities.
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