This paper examines the innovation processes of Small and Medium
Enterprises (SMEs) in peripheral areas, particularly in the municipality of Guarda
and in the islands of Sao Miguel and Santa Maria in the Azores. For this purpose, a
survey was conducted, and three models were estimated: a Logit model, to measure
the difference between firms that innovate and those that do not; a Tobit model,
to measure the intensity of innovation; and a Probit model to analyze the type of
innovation. The results show a positive relationship between the introduction of innovations
in the market sector and the age and activity of the companies, an inverse
relationship in regards to the size of the company and in relation to the region.