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Dissecting the impact of innovation on exporting in Turkey

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  • Alessia LO TURCO

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

  • Daniela MAGGIONI

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

Abstract

Making use of an original firm level dataset, we explore the causal impact of innovation on the manufacturing firm export activity in Turkey. We model process and product innovation as separately - through cost savings and product quality improvements, respectively - affecting the firm profitability and, consequently, the firm export propensity. This modeling choice highlights heterogeneous effects across high and low income destination markets. In a Multiple Propensity Score Matching framework, we, then, test the impact of each innovation activity and of their joint adoption. We find that only the latter fosters the first time entry into exporting, when the destination market is high income. Nevertheless, innovation positively affects the firmexport propensity. New product introduction is more rewarding than process innovation, especially for exporting to lowincome economies. Process innovation, though, strengthens the positive role of product innovation for exporting to more advanced markets.

Suggested Citation

  • Alessia LO TURCO & Daniela MAGGIONI, 2013. "Dissecting the impact of innovation on exporting in Turkey," Working Papers 388, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
  • Handle: RePEc:anc:wpaper:388
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    References listed on IDEAS

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    Cited by:

    1. Wu, Lichao & Wei, Yingqi & Wang, Chengang, 2021. "Disentangling the effects of business groups in the innovation-export relationship," Research Policy, Elsevier, vol. 50(1).
    2. Alguacil Marí, María Teresa & Lo Turco, Alessia & Martínez-Zarzoso, Inmaculada, 2020. "What is so special about robots and trade?," Center for European, Governance and Economic Development Research Discussion Papers 410, University of Goettingen, Department of Economics.
    3. Rossi, Stefania Patrizia Sonia & Bonanno, Graziella & Giansoldati, Marco & Gregori, Tullio, 2021. "Export starters and exiters: Do innovation and finance matter?," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 280-297.
    4. Alessia Lo Turco & Daniela Maggioni, 2015. "Imports, Exports and the Firm Product Scope: Evidence From Turkey," The World Economy, Wiley Blackwell, vol. 38(6), pages 984-1005, June.

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    More about this item

    Keywords

    Turkey; export; process innovation; product innovation;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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