 Import and innovation: Evidence from Chinese firmsZhiyuan Chen, Jie Zhang and Wenping Zheng European Economic Review, 2017, vol. 94, issue C, 205-220 Abstract: This paper investigates the relationship between imports and innovation by importing firms. We first construct a theoretical model in which imports stimulate innovation through cost-reducing knowledge spillovers. We then employ a combined micro dataset of Chinese manufacturing firms to estimate the effects of imported intermediates on the firm's R&D investment. The dataset allows us to construct firm-year level instruments for importing and exporting that are uncorrelated with the innovation decision of the firm. Our estimations find that: (1) importing intermediates tends to increase importing firms’ R&D intensity; and that (2) exporting also increases importing firms' R&D intensity. Examining the channels through which importing affects innovation, we find that importing from high-income sources has a greater impact on innovation. High-tech firms tend to experience greater increases in innovation intensity, as do private firms. Our results are supported by a series of robustness checks. Keywords: Imports; Exports; R&D intensity (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:94:y:2017:i:c:p:205-220 DOI: 10.1016/j.euroecorev.2017.02.008 Access Statistics for this article European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer More articles in European Economic Review from Elsevier |
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