Endogenous product versus process innovation and a firm’s propensity to export

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This paper provides an empirical analysis of the effects of new product versus process innovations on export propensity at the firm level. Product innovation is a key factor for successful market entry in models of creative destruction and Schumpeterian growth. Process innovation helps securing a firm's market position given the characteristics of its product supply. Both modes of innovation are expected to raise a firm's propensity to export. According to new trade theory, we conjecture that product innovation is relatively more important in that regard. We investigate these hypotheses in a rich survey panel data set with information about new innovations of either type. With a set of indicators regarding innovation motives and impediments and continuous variables at the firm and industry level at hand, we may determine the probability of launching new innovations and their impact on export propensity at the firm level through a double treatment approach. Terms of use: Documents inJEL Code: F1, O3, L1.

Technology and costs in international competitiveness: From countries and sectors to firms

“…Productivity levels are positively correlated with the propensity to export (except in column (4)), and the same positive effect holds for the three innovation variables. We find that the simultaneous introduction of a product and process innovation has an impact on firms' export propensity, in line with the results of Becker and Egger (2013). However, differently from them, we find that also process innovation in isolation has an effect, even if the effect is lower than the one obtained from product innovation alone, in agreement with the findings of Caldera (2010).…”

“…More recently, on the micro side, the evidence on the determinants of export decision and export intensity has begun to shed light on the fundamental role of product and process innovation driving the export behaviour at the firm level (Wakelin, 1998;Sterlacchini, 1999;Basile, 2001;Castellani and Zanfei, 2007;Caldera, 2010;Becker and Egger, 2013).…”

Beyond the average effects: The distributional impacts of export promotion programs in developing countries

“…In particular, we include (lagged) total sales, (lagged) total exports, the (lagged) number of countries the firms export to, and the (lagged) number of products exported, in the specification of the propensity score (see also Ashenfelter, 1978;Becker and Egger, 2007). 29 In addition, previous use of services provided by PROCHILE may affect current participation.…”

Entering new country and product markets: does export promotion help?

“…On the other hand, relatively larger and more experienced firms may be more likely to be aware of and use export promotion services (see, e.g., Reid, 1984;Kedia and Chhokar, 1986;and Ahmed et al, 2002). We therefore include three measures of previous export experience, namely, total exports, number of countries the firm exports to, and number of products exported, all lagged on year, as determinants of the probability of participating in trade promotion programs (see Ashenfelter, 1978;Becker and Egger, 2007).Noteworthy, As we will discuss below these export indicators are implicitly capturing productivity differences across (groups of)…”