IDEAS home Printed from https://ideas.repec.org/h/spr/sprchp/978-981-15-7522-8_6.html
   My bibliography  Save this book chapter

Export Tightening, Competition, and Firm Innovation

In: Exchange Rate, Credit Constraints and China’s International Trade

Author

Listed:
  • Miaojie Yu

    (Peking University)

Abstract

This chapter investigates how firm innovation reacts to changes in competitive pressure in the export market. We use the exchange rate appreciation of the RMB during 2005–2007 as a natural experiment and exploit its differential impact on Chinese manufacturing firms with different export exposure. The appreciation reduced exports and imposed greater competitive pressure on exporters relative to non-exporters. In response, exporters increased innovation activities more than non-exporters. Using a difference-in-difference approach, we find the R&D expenses of exporters increased by 11% more than non-exporters during the appreciation period, and the new product development of exporters increased by nearly 1.5 times more than non-exporters. Innovation increased for productive, continuing exporters but decreased for less productive firms that quit exporting. These results contradict the prediction of models that link export and innovation solely via market size effects, and suggest the important role of competition in determining firm innovation.

Suggested Citation

  • Miaojie Yu, 2021. "Export Tightening, Competition, and Firm Innovation," Springer Books, in: Exchange Rate, Credit Constraints and China’s International Trade, chapter 0, pages 163-193, Springer.
    • Handle: RePEc:spr:sprchp:978-981-15-7522-8_6
    DOI: 10.1007/978-981-15-7522-8_6
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:sprchp:978-981-15-7522-8_6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.