The interaction between formal and informal businesses continues to grow in African countries. Yet, competition from informal enterprises remains one of the top three obstacles formal businesses face in sub-Saharan Africa. This paper investigates the effect of informal competition on the performance of innovative products introduced by formal firms. We combine the World Bank’s Enterprise Survey with the Innovation Follow-up Survey for five sub-Saharan African countries, and construct two indicators of informal competition, one regional (local)-specific and the other one industry-specific. We find that local informal competition has a robust negative effect on product innovation intensity of formal firms, while within industry informal competition enhances innovative sales. However, larger firms are less affected by local informal competition and actually get a boost in innovative sales from informal competition. We argue that local informal competition harms the performance of product innovation, but only for formal firms that lack strategic collaborative ‘footholds’ in the informal economy.

在非洲国家，正规企业和非正规企业之间的互动继续增长。然而，来自非正规企业的竞争仍然是正规企业在撒哈拉以南非洲面临的三大障碍之一。本文研究了非正式竞争对正式公司推出的创新产品的绩效的影响。我们将世界银行的企业调查与五个撒哈拉以南非洲国家的创新跟进调查结合起来，构建了两个非正式竞争指标，一个是区域（地方）特定的，另一个是行业特定的。我们发现地方非正式竞争对正式企业的产品创新强度有很强的负面影响，而行业内非正式竞争会提高创新销售。然而，较大的公司受当地非正式竞争的影响较小，实际上从非正式竞争中获得了创新销售的推动。我们认为，地方非正式竞争会损害产品创新的绩效，但仅适用于在非正式经济中缺乏战略协作“立​​足点”的正式公司。