Table 1 Definition of basic variables

Innovation

It was constructed considering product and/or process innovation.

It was a dummy variable taking a value of 1 if the enterprise innovative, 0 otherwise.

Corruption

It reflects perception and/or actual experiences what the enterprise managers or owners faced from government officials who have the interest of misusing public authority for personal gains. Moreover, do enterprise owners or managers deliberately participate in corruptive activities?

It was a dummy variable taking a value of 1 if the enterprise managers or owners participate in corruptive activities, 0 otherwise.

Political instability

It refers the likelihood of violence, terrorism, harassing, and any of unjust activities that disturb the normal day-to-day activities of firms in Ethiopia in each survey year.

It took value of 1 if enterprises experienced any sort of political instability, or else 0.

Enterprises’ characters

This variable includes enterprise type and international market participation as a core issue.

• The enterprise type was categorical variable considering manufacturing enterprises as a base.

• On the other hand, a value of 1 was assigned if the enterprise participates in international markets.

Infrastructure access

This variable includes:

• Access to training, Internet, and working capital

• Number and type of employees

• Sustainable power supply

• Time and capital budget for research and development

• Dummy variable based on access to those facilities.

• Continuous variable (number and proportion of graduate workers.

• Dummy variable based on availability and outage.

• Proportion of time and capital budgeted for research and development within each enterprise.