The R&D and innovation effects of firm-specific trade opportunities

Josefin Videnord ()
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Josefin Videnord: Tillväxtanalys

No 2025:14, Working Paper Series from IFAU - Institute for Evaluation of Labour Market and Education Policy

Abstract: This paper explores how firm-specific trade opportunities affect R&D investments and innovative activities. To construct trade opportunities that are exogenous to firm-level decisions, I use the variation in export and import patterns and exploit the fact that firms differ in their product-country exporting (sourcing) patterns. Both export and import opportunities generate growth in terms of sales, value-added, overall employees, and high-skilled employees. Despite having similar effects on firm growth, the effects on innovation activities are very different for the two trade shocks. Export opportunities lead to more R&D investments (spending, employees, and intensity) and innovations (product and process). On the other hand, import opportunities show no effects on R&D investments, and the impact on product, process, and service innovation is negative.

Keywords: R&D; Innovation; International; trade; Export; Import (search for similar items in EconPapers)
JEL-codes: F10 F14 O31 O32 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2025-08-29
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:ifauwp:2025_014

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