Innovation, Product Sophistication and Export Market Survival: A Study of Indian Manufacturing
Subash Sasidharan () and
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Ketan Reddy: Indian Institute of Technology Madras
No DP-2021-45, Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA)
The present study investigates the role of innovation on global market survival of Indian manufacturing firms. Specifically, the study examines whether research and development (R&D) investment enables firms to survive longer in export markets and global value chain markets. To achieve this objective, we source information on firms trading behaviour and R&D investments from the CMIE-Prowess database for the period 2001–18. Using a complementary log-log model, we find that firms investing in R&D experience a lower probability of exiting international markets. In addition, multiple sub-sample analysis indicates that importance of R&D becomes even more prominent for small and medium-sized firms. Based on the empirical findings, the study proposed policy suggestions for India.
Keywords: Global Value Chains; Research and Development; Survival analysis (search for similar items in EconPapers)
JEL-codes: F14 F15 L6 O32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-int and nep-sbm
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