Is there any empirical evidence that firms become more efficient after becoming exporters? Do firms that become exporters generate positive spillovers for domestically-oriented producers? In this paper we analyze the causal links between exporting and productivity using firm-level panel data from three semi-industrialized countries. Representing export market participation and production costs as jointly dependent autoregressive processes, we look for evidence that firms' stochastic cost processes shift when they break into foreign markets. We find that relatively efficient firms become exporters, but firms' unit costs are not affected by previous export market participation. So the well-known efficiency gap between exporters and non-exporters is due to selfselection of the more efficient firms into the export market, rather than learning by exporting, Further, we find some evidence that exporters reduce the costs of breaking into foreign markets for domestically oriented producers, but they do not appear to help these producers become more efficient.

Is there any empirical evidence that firms become more efficient after becoming exporters? Do firms that become exporters generate positive spillovers for domestically-oriented producers? In this paper we analyze the causal links between exporting and productivity using firm-level panel data from three semi-industrialized countries. Representing export market participation and production costs as jointly dependent autoregressive processes, we look for evidence that firms' stochastic cost processes shift when they break into foreign markets. We find that relatively efficient firms become exporters, but firms' unit costs are not affected by previous export market participation. So the well-known efficiency gap between exporters and non-exporters is due to selfselection of the more efficient firms into the export market, rather than learning by exporting, Further, we find some evidence that exporters reduce the costs of breaking into foreign markets for domestically oriented producers, but they do not appear to help these producers become more efficient.

In evaluating the e¡ect of an R&D subsidy we need to know what the subsidized ¢rm would have spent on R&D had it not received the subsidy. Using data on Israeli manufacturing ¢rms in the 1990s we ¢nd evidence suggesting that the R&D subsidies granted by the Ministry of Industry and Trade greatly stimulated company ¢nanced R&D expenditures for small ¢rms but had a negative e¡ect on the R&D of large ¢rms, although not statistically signi¢cant. One subsidized New Israeli Shekel (NIS) induces 11 additional NIS of own R&D for the small ¢rms. However, because most subsidies go to the large ¢rms a subsidy of one NIS generates, on average, a statistically insigni¢cant 0.23 additional NIS of company ¢nanced R&D.

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Using data on U.S. universities, we show that universities that give higher royalty shares to faculty scientists generate greater license income, controlling for university size, academic quality, research funding and other factors. We use pre-sample data on university patenting to control for the potential endogeneity of royalty shares. We find that scientists respond both to cash royalties and to royalties used to support their research labs, suggesting both pecuniary and intrinsic (research) motivations. The incentive effects appear to be larger in private universities than in public ones, and we provide survey evidence indicating this may be related to differences in the use of performance pay, government constraints, and local development objectives of technology license offices. Royalty incentives work both by raising faculty effort and sorting scientists across universities. The effect of incentives works primarily by increasing the quality (value) rather than the quantity of inventions.