IDEAS home Printed from https://ideas.repec.org/p/era/wpaper/dp-2012-08.html
   My bibliography  Save this paper

The Link between Innovation and Export: Evidence from Australia fs Small and Medium Enterprises

Author

Listed:
  • Alfons PALANGKARAYA

    (Alfons PALANGKARAYA Melbourne Institute of Applied Economic and Social Research and the Intellectual Property Research Institute of Melbourne)

Abstract

This paper investigates the direction of causality between export market participation and innovation using firm level data from Australia. Using the propensity score matching approach, the paper asks whether: (i) exporting in the current period is positively correlated with the probability to innovate in the same or the next period, (ii) the relationship in (i) is true for firms who have no export market participation in the previous period, (iii) innovating in the current period leads to export market participation in the same or the next period, and (iv) the relationship in (iii) is true for firms who have no innovation in the previous period. The paper finds a statistically and economically significant positive correlation between export and innovation in the current period. Furthermore, with regards to the direction of causality, there is evidence that it runs both ways for process innovation particularly for the services sector. For product innovation, there is evidence that current product innovator may lead to a higher probability of becoming enew f exporter in the current period.

Suggested Citation

  • Alfons PALANGKARAYA, 2012. "The Link between Innovation and Export: Evidence from Australia fs Small and Medium Enterprises," Working Papers DP-2012-08, Economic Research Institute for ASEAN and East Asia (ERIA).
  • Handle: RePEc:era:wpaper:dp-2012-08
    as

    Download full text from publisher

    File URL: http://www.eria.org/ERIA-DP-2012-08.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Ilke Van Beveren & Hylke Vandenbussche, 2010. "Product and process innovation and firms' decision to export," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 13(1), pages 3-24.
    2. Gustavo Crespi & Chiara Criscuolo & Jonathan Haskel, 2008. "Productivity, exporting, and the learning-by-exporting hypothesis: direct evidence from UK firms," Canadian Journal of Economics, Canadian Economics Association, vol. 41(2), pages 619-638, May.
    3. Sourafel Girma & Holger Görg & Aoife Hanley, 2008. "R&D and Exporting: A Comparison of British and Irish Firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 144(4), pages 750-773, December.
    4. Alfons Palangkaraya & Jongsay Yong, 2007. "Exporter and Non-Exporter Productivity Differentials: Evidence from Australian Manufacturing Establishments," Melbourne Institute Working Paper Series wp2007n04, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    5. Megan MacGarvie, 2006. "Do Firms Learn from International Trade?," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 46-60, February.
    6. Paul H. Jensen & Elizabeth Webster, 2006. "Firm Size and the Use of Intellectual Property Rights," The Economic Record, The Economic Society of Australia, vol. 82(256), pages 44-55, March.
    7. Alfons Palangkaraya & Jongsay Yong, 2011. "Trade Liberalisation, Exit, and Output and Employment Adjustments of Australian Manufacturing Establishments," The World Economy, Wiley Blackwell, vol. 34(1), pages 1-22, January.
    8. Sascha Becker & Peter Egger, 2007. "Endogenous Product versus Process Innovation and a Firm’s Propensity to Export," CESifo Working Paper Series 1906, CESifo Group Munich.
    9. Ana Margarida Fernandes & Caroline Paunov, 2010. "Does Trade Stimulate Innovation?: Evidence from Firm-Product Data," OECD Development Centre Working Papers 286, OECD Publishing.
    10. 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.
    11. Arundel, Anthony & Kabla, Isabelle, 1998. "What percentage of innovations are patented? empirical estimates for European firms," Research Policy, Elsevier, vol. 27(2), pages 127-141, June.
    12. Jože P. Damijan & Črt Kostevc & Sašo Polanec, 2010. "From Innovation to Exporting or Vice Versa?," The World Economy, Wiley Blackwell, vol. 33(3), pages 374-398, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Peñasco, Cristina & del Río, Pablo & Romero-Jordán, Desiderio, 2017. "Analysing the Role of International Drivers for Eco-innovators," Journal of International Management, Elsevier, vol. 23(1), pages 56-71.
    2. Sandra M. Leitner & Robert Stehrer, 2016. "The Role of Financial Constraints for Different Innovation Strategies: Evidence for CESEE and FSU Countries," wiiw Working Papers 125, The Vienna Institute for International Economic Studies, wiiw.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:era:wpaper:dp-2012-08. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Hiroshi Okasaki). General contact details of provider: http://edirc.repec.org/data/eriadid.html .

    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.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.