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Sources of Learning-by-Exporting Effects: Does Exporting Promote Innovation?

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  • Keiko ITO

    (Keiko ITO School of Economics, Senshu University)

Abstract

This paper examines whether first-time exporters achieve productivity improvements through learning-by-exporting effects. The results suggest that starting exporting to North America/Europe has a strong positive effect on sales and employment growth, R&D activity, and productivity growth. On the other hand, starting exporting to Asia does not have any strong productivity enhancing effects, although it does tend to raise the growth rates of sales and employment and be associated with an increase in R&D expenditure. However, even for these variables, the positive impact of starting exporting to North America/Europe is much larger. Further analysis shows that export starters to North America/Europe are larger, more productive, more R&D intensive, and more capital intensive than export starters to Asia even before they start exporting, suggesting that the former are potentially better performers than the latter. In other words, the former have greater absorptive capacity, and this absorptive capacity itself may be a source of the larger positive learning-by-exporting effects. Moreover, export starters to North America/Europe become more innovative than export starters to Asia after starting exporting. The results obtained imply that potentially innovative non-exporters should be supported through an export promotion policy. Firms that have the potential to be sufficiently innovative to export to developed regions are likely to benefit from doing so through the positive interaction between exporting and innovation.

Suggested Citation

  • Keiko ITO, 2012. "Sources of Learning-by-Exporting Effects: Does Exporting Promote Innovation?," Working Papers DP-2012-06, Economic Research Institute for ASEAN and East Asia (ERIA).
  • Handle: RePEc:era:wpaper:dp-2012-06
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    References listed on IDEAS

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    1. Keiko Ito & Sébastien Lechevalier, 2009. "The evolution of the productivity dispersion of firms: a reevaluation of its determinants in the case of Japan," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(3), pages 405-429, October.
    2. Jan De Loecker & Frederic Warzynski, 2012. "Markups and Firm-Level Export Status," American Economic Review, American Economic Association, vol. 102(6), pages 2437-2471, October.
    3. Ilke Van Beveren & Hylke Vandenbussche, 2009. "Product and Process Innovation and the Decision to Export: Firm-level Evidence for Belgium," LICOS Discussion Papers 24709, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    4. TODO Yasuyuki, 2009. "Quantitative Evaluation of Determinants of Export and FDI: Firm-level evidence from Japan," Discussion papers 09019, Research Institute of Economy, Trade and Industry (RIETI).
    5. Rachel Bocquet & Patrick Musso, 2010. "Product Innovation and Export Performance," Post-Print halshs-00721783, HAL.
    6. Cassiman, Bruno & Golovko, Elena & Martínez-Ros, Ester, 2010. "Innovation, exports and productivity," International Journal of Industrial Organization, Elsevier, vol. 28(4), pages 372-376, July.
    7. Rachel Griffith & Elena Huergo & Jacques Mairesse & Bettina Peters, 2006. "Innovation and Productivity Across Four European Countries," Oxford Review of Economic Policy, Oxford University Press, vol. 22(4), pages 483-498, Winter.
    8. Kyoji Fukao & Hyeog Ug Kwon, 2006. "Why Did Japan'S Tfp Growth Slow Down In The Lost Decade? An Empirical Analysis Based On Firm-Level Data Of Manufacturing Firms," The Japanese Economic Review, Japanese Economic Association, vol. 57(2), pages 195-228.
    9. Fukunari Kimura & Kozo Kiyota, 2006. "Exports, FDI, and Productivity: Dynamic Evidence from Japanese Firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(4), pages 695-719, December.
    10. Edwin Leuven & Barbara Sianesi, 2003. "PSMATCH2: Stata module to perform full Mahalanobis and propensity score matching, common support graphing, and covariate imbalance testing," Statistical Software Components S432001, Boston College Department of Economics, revised 01 Feb 2018.
    11. Sascha Becker & Peter Egger, 2013. "Endogenous product versus process innovation and a firm’s propensity to export," Empirical Economics, Springer, vol. 44(1), pages 329-354, February.
    12. Keiko Ito & Sébastien Lechevalier, 2010. "Why some firms persistently out-perform others: investigating the interactions between innovation and exporting strategies," Industrial and Corporate Change, Oxford University Press, vol. 19(6), pages 1997-2039, December.
    13. WAKASUGI Ryuhei & TODO Yasuyuki & SATO Hitoshi & NISHIOKA Shuichiro & MATSUURA Toshiyuki & ITO Banri & TANAKA Ayumu, 2008. "The Internationalization of Japanese Firms: New Findings Based on Firm-Level Data," Discussion papers 08036, Research Institute of Economy, Trade and Industry (RIETI).
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    Cited by:

    1. Mohammad Movahedi & Olivier Gaussens, 2013. "Les effets de l’exportation sur l’innovation et la productivité : Analyse empirique sur un échantillon de PMI," Economics Working Paper Archive (University of Rennes 1 & University of Caen) 201307, Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS.
    2. Briceño Avalos, Hernán Ricardo, 2013. "The Industry oriented Asian Tigers and the Natural Resource based Pacific Alliance Economic Growth Models," MPRA Paper 61665, University Library of Munich, Germany.
    3. Kim, Kyunam & Kim, Yeonbae, 2015. "Role of policy in innovation and international trade of renewable energy technology: Empirical study of solar PV and wind power technology," Renewable and Sustainable Energy Reviews, Elsevier, vol. 44(C), pages 717-727.

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