From Innovation to Exporting or Vice Versa?

Abstract

1 We acknowledge .nancial support of the European Coommission under the grant CIT5-028812 (Dyn-regDynamic regions in a knowledge driven global economy). The usual disclaimer applies. AbstractFirm productivity and export decisions are closely related to innovation activity. Innovation may play a more important role in the decision to start exporting, and successful exporting may drive process innovation. This suggests that the causality between innovation and exporting may run in both directions. Using detailed micro-data from innovation surveys, industrial production surveys, and trade information for Slovenian .rms in 1996-2002, we investigate the bidirectional causal relationship between firm innovation and export activity. We find no evidence for the hypothesis that either product or process innovations increase the probability of becoming a first-time exporter, but we do .nd evidence in both the innovation survey and the industrial production survey that exporting leads to productivity improvements. These, however, are likely to be related to process rather than product innovations, and are observed only in a sample of medium and large .rst-time exporters.

Dissecting the impact of innovation on exporting in Turkey

“…Within the literature on emerging economies, our findings are at odds with the nonsignificant effect of innovation shown by Damijan, Kostevc, and Polanec (2010) in Slovenian manufacturing, nonetheless they are in line with the positive and significant impact found for Vietnam by Nguyen et al (2008). This may be related to the different economic development level of Slovenia, on the one hand, and Vietnam and Turkey, on the other.…”

“…Lin and Lin (2010) for Taiwan enlarge the scope to the analysis of the impact of imports and inward and outward foreign direct investments (FDI) and find a positive effect of both trade and FDI on innovation. On the contrary, Damijan, Kostevc, and Polanec (2010) for the Slovenian case find no significant effect on product innovation from export entry, while it spurs medium and large firms to introduce process innovations. They also find no evidence on the opposite nexus, from innovation to exporting.…”

Firm investment and exporting: Evidence from China's value-added tax reform

“…Following Manova (2013) and Manova and Yu (2014), we construct the measure of external …nancial dependence as the share of aggregate capital expenditures not …nanced with internal cash ‡ows from operations at the 4-digit industry level using the pre-reform period data. 16 We then divide the sample into two subsamples, i.e., …rms in industries with external …nancial dependence above and below the median of industrial external …nance dependence. The second stage results of the instrumental variable estimations using these two subsamples are reported in columns 1 and 2 of Table 6, respectively.…”

Does Trade Foster Employment Growth in Emerging Markets? Evidence from Turkey

“…In this context, Abadie and Imbens (2008) show that bootstrapped standard errors are not valid and may overestimate as well as underestimate the asymptotic standard errors. In the computation of subsampling standard errors we used the 75% of the sample for each bootstrap draw, following Damijan, Kostevc, and Polanec (2010) and who use subsamples consisting of 75-80% of the population in the original sample.…”