Asian Journal of Economics, Business and Accounting

Innovation has become a critical determinant of firm survival and competitiveness amid intensifying competition in both domestic and international markets. This study examines the effects of organizational capabilities and market competitive pressure on firm-level innovation in Ghana. Using firm-level data from the 2023 World Bank Enterprise Survey for Ghana, the initial dataset comprised 713 firms; however, after data management, the final usable sample was reduced to 694 firms. The study employs Ordered Probit, Ordered Logit, and Generalized Ordered Logit models, with the Ordered Probit model serving as the baseline specification. The empirical results reveal that organizational capabilities and market competitive pressure significantly and positively influence firms’ likelihood of achieving higher levels of innovation. The findings further indicate that firm size, firm age, and export participation positively affect innovation outcomes. The study contributes to the literature by jointly examining organizational capabilities and market competitive pressure as determinants of firm innovation in Ghana while employing multiple ordered response models to ensure robustness of the empirical evidence. Overall, the study concludes that strengthening organizational capabilities and fostering competitive market conditions are essential for enhancing firm-level innovation in emerging economies such as Ghana. The findings provide important implications for managers and policymakers in Ghana, underscoring the need for firms to strengthen internal capabilities, while government agencies foster competitive markets and promote export participation to enhance firm-level innovation outcomes. This study contributes to emerging market literature by providing evidence from Ghana on the joint effects of organizational capabilities and market competitive pressure on firm innovation.