DP6411 Innovation and the Export-productivity Link

Author(s): Bruno Cassiman, Elena Golovko
Publication Date: August 2007
Keyword(s): exports, innovation, process innovation, product innovation, productivity
JEL(s): D21, O31, O32
Programme Areas: Industrial Organization, International Trade and Regional Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=6411

We explore the relationship between innovation activity, productivity, and exports using a panel of Spanish manufacturing firms for 1990-1998. Our results - based on non-parametric tests - suggest that firm innovation status is important in explaining the positive export-productivity association documented in prior research. For the sample of small innovating firms, we find no significant differences in productivity levels between exporters and non-exporters. Especially product innovation seems to explain the positive association between exports and productivity for this group of firms. For small non-innovating firms with low and medium productivity levels exporting firms continue to exhibit higher productivity than non-exporting firms.