A firm's export status may improve its capacity of introducing product innovations. We explore this idea using very rich firm-level data on Italian Manufacturing, and sector-province specific measures of firms' distance from export markets and of their export market potential as instruments for differences in export activities. We find that exporting significantly increases the likelihood of introducing product innovations and that this effect is not fully captured by the channels commonly stressed by the theoretical literature, such as larger market (and accordingly firm) size or higher investments in R&D. We argue that heterogeneity in foreign customers' tastes and needs may explain our findings.

A firm's export status may improve its ability to introduce product innovations (learning by exporting). We explore this idea using very rich firm-level data on Italian manufacturing, which enables us to control for many confounding factors in the exporting-product innovation link (i.e. selection on observable variables). We also make an attempt to address the potential self-selection of firms into exporting according to unobservable characteristics using an industry-province specific measure of firm distances from their most likely export markets, and of these export markets' potentials as sources of presumably exogenous variations in export status using an instrumental variables strategy. We find that export status significantly increases the likelihood of introducing product innovations and that this effect is not fully captured by the channels commonly stressed by the theoretical literature, such as larger markets (and accordingly firm size) or higher investments in R&D. We argue that heterogeneity in foreign customers' tastes and needs may explain our findings. © 2012 Blackwell Publishing Ltd

In this paper we investigate the relationship between participation in global value chains (GVCs) and countries' innovation performance. We use the recently released world input-output database to build spillover variables by weighting the aggregate R&D stock of partners supplying inputs with two alternative measures of participation in GVCs: the share of foreign value added in a country's gross exports and the offshoring index. We use these indicators to test empirically the relationship between a country's innovation performance, proxied by patent per capita, and spillovers generated by GVCs. Our results show that the involvement in GVCs, in particular for developing countries importing inputs from advanced economies, is positively related with a country's innovation outcome suggesting that international fragmentation of production can indeed be a channel allowing for international technology transfer from developed to developing countries.Nous étudions la relation entre la participation aux chaînes de valeur mondiales (CVM) et la performance de l'innovation au niveau des pays. Nous utilisons la base de données mondiale des entrées-sorties (WIOD) récemment lancée pour établir les variables de retombées en pondérant le stock total de RD des partenaires fournissant des biens avec deux autres mesures de participation aux CVM: la part de la valeur ajoutée étrangère dans les exportations brutes et l'indice de délocalisation. Nous utilisons ces indicateurs pour tester empiriquement la relation entre le degré d'innovation d'un pays, représenté par le nombre de brevet par habitant, et les retombées générées par les chaînes de valeur mondiales. Nos résultats montrent que l'implication dans les CVM est positivement corrélée au degré d'innovation d'un pays, en particulier pour les pays en développement importateurs des biens en provenance d'économies avancées, suggérant ainsi que la fragmentation internationale de la production peut être un vecteur permettant le transfert international de technologie des pays développés vers les pays en développement.

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