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How innovation impacts firms' export survival: Does export mode matter?

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  • Meihong Dai
  • Haiyang Liu
  • Lingtao Lin

Abstract

The innovation‐export nexus has been extensively explored, while relatively few studies have focused on innovation's impact on firms' export survival and the role of export mode. Using a large panel dataset from China, this research empirically explores how innovation impacts firms' export survival, considering export modes. First, we employ the discrete‐time survival analysis model (cloglog) to examine this research addressing the censored issue. Second, the propensity score matching (PSM) methodology is employed to address the selection‐bias issue and select the similar firms based on which to compare their Kaplan–Meier survivor probability. Results present a positive role of innovation in the export survival of direct exporters; however, there is an inverted‐U relationship between innovation intensity and their survival probability. For indirect exporters, evidence shows an insignificant innovation‐export survival nexus. In addition, results show higher export survival for Chinese innovative exporters who are foreign‐owned, highly export‐intensive, long‐lasting in export market, in technology industries. For innovative exporters who export directly, those in medium and low‐technological industries and export capital goods are more likely to survive. Our research provides insights for Chinese exporters regarding innovation participation and suggests the government conducting prudent and deliberate design for innovation strategy.

Suggested Citation

  • Meihong Dai & Haiyang Liu & Lingtao Lin, 2020. "How innovation impacts firms' export survival: Does export mode matter?," The World Economy, Wiley Blackwell, vol. 43(1), pages 81-113, January.
    • Handle: RePEc:bla:worlde:v:43:y:2020:i:1:p:81-113
    DOI: 10.1111/twec.12847
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    Cited by:

    1. Manon Enjolras & Mauricio Camargo & Christophe Schmitt, 2020. "Evaluating Innovation and Export Capabilities of SMEs: Toward a Multi-Criteria Decision-Making Methodology," Post-Print hal-03000609, HAL.
    2. Edmund Mallinguh & Christopher Wasike & Zeman Zoltan, 2020. "Technology Acquisition and SMEs Performance, the Role of Innovation, Export and the Perception of Owner-Managers," JRFM, MDPI, vol. 13(11), pages 1-19, October.
    3. Ketan Reddy & Subash Sasidharan, 2022. "Servicification and global value chain survival: Firm‐level evidence from India," Australian Economic Papers, Wiley Blackwell, vol. 61(3), pages 455-473, September.
    4. Redha Fares, 2022. "Bankruptcy, Performance and Market Selection: Evidence from Firms in France," Erudite Ph.D Dissertations, Erudite, number ph22-01 edited by Claude Mathieu, March.
    5. Subash Sasidharan & Ketan Reddy, 2021. "Innovation, Product Sophistication and Export Market Survival: A Study of Indian Manufacturing," Working Papers DP-2021-45, Economic Research Institute for ASEAN and East Asia (ERIA).
    6. Muñoz, Camila & Galvez, Daniel & Enjolras, Manon & Camargo, Mauricio & Alfaro, Miguel, 2022. "Relationship between innovation and exports in enterprises: A support tool for synergistic improvement plans," Technological Forecasting and Social Change, Elsevier, vol. 177(C).
    7. Redha Fares & Amélie Guillin, 2022. "R&D expenditures and firm survival," Erudite Working Paper 2022-04, Erudite.
    8. Margalida Murillo & Cindy Paola Leal, 2021. "Tratados de Libre Comercio y duración de las exportaciones: Evidencia a nivel de firma para Colombia," Revista Desarrollo y Sociedad, Universidad de los Andes – Facultad de Economía – CEDE, vol. 88(6), pages 201-238, July.

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