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Learning from Trade through Innovation

Author

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  • Jože P. Damijan
  • Črt Kostevc

Abstract

type="main" xml:id="obes12071-abs-0001"> This paper explores the idea that firms learn from trade by introducing either new products or processes influenced by their trade links with foreign markets. By exploring microdata for Spain, including data on innovation and trade, we find a robust relationship between imports, exports and innovation. The results suggest that firms learn primarily from import links, which enable them to innovate and to ‘dress up’ for starting to export. This sequencing between trade and innovation, however, is shown to be more pronounced for small firms only and technologically advanced firms.

Suggested Citation

  • Jože P. Damijan & Črt Kostevc, 2015. "Learning from Trade through Innovation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 77(3), pages 408-436, June.
    • Handle: RePEc:bla:obuest:v:77:y:2015:i:3:p:408-436
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    File URL: http://hdl.handle.net/10.1111/obes.2015.77.issue-3
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