Product and Process Innovation and the Decision to Export: Firm-level Evidence for Belgium

Ilke Van Beveren and Hylke Vandenbussche ()

LICOS Discussion Papers from LICOS - Centre for Institutions and Economic Performance, K.U.Leuven

Abstract: Using data from the Community Innovation Survey for Belgium in two consecutive periods, this paper explores the relationship between firm-level innovation activities and the propensity to start exporting. To measure innovation, we include indicators of both innovative effort (R&D activities) as well as innovative output (product and process innovation). Our results suggest that the combination of product and process innovation, rather than either of the two in isolation, increases a firm¡¯s probability to enter the export market. After controlling for potential endogeneity of the innovation activities, only firms with a sufficiently high probability to start exporting engage in product and process innovation prior to their entry on the export market, pointing to the importance of self-selection into innovation.

Keywords: Exports; Product innovation; Process innovation; Self-selection; Firm heterogeneity (search for similar items in EconPapers)
JEL-codes: D24 F14 L25 O31 O33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino, nep-knm and nep-sbm
Date: 2009
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Persistent link: http://EconPapers.repec.org/RePEc:lic:licosd:24709

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