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Creativity pays off. Innovation, innovation strategy, and internationalization

Tomasz Brodzicki () and Dorota Ciołek ()

No 1601, Working Papers from Instytut Rozwoju, Institute for Development

Abstract: A lot of recent empirical research points to the superior performance of exporting firms in comparison to non-exporters. Exporters on average are found to be larger, more productive, more capital and skilled-intensive than non-exporters At the same time, innovation and exporting seem to be inextricably linked at firm-level. Apart from several recent studies, the literature on it for Poland is scarce. This paper analyses the relationship between innovation behaviour, declared innovation strategy and internationalization in a panel of firms from Poland from an extensive survey conducted by the Institute for Development. The results support the idea that the superior performance of the exporters is linked to a large extent to their superior innovation performance. Exporters prove to be more focused on innovations, are more aware of the need to implement changes, and are better prepared to introduce them in reality. They are more probable to be creative and are more likely to behave in a more strategic manner assuming the position of a market leader. We positively identify critical linkages between the declared innovation strategy and export states of Polish companies. Utilizing the classification of Hobday, Rush & Bessant (2004) and controlling for the significance of innovation (firm or market) level, we show that innovatively passive firms have, ceteris paribus, a significantly lower probability of obtaining exporter status. The introduction of innovations at ad hoc manner has a positive however statistically insignificant effect. Only permanent innovators or creative firms enjoy a clear and robust increase in their exporting probability potential. It simply pays off to be innovative. At the same time, our results support the postulates by Altomonte et al. (2013), on the close connection between innovation and internationalization extents.

Keywords: Innovation, Innovation strategy; Internationalization; Trade; Firms survey; Logit modelling (search for similar items in EconPapers)
JEL-codes: F14 C83 C21 D22 L25 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-ino, nep-int, nep-sbm and nep-tra
Date: 2016-06
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http://www.instytut-rozwoju.org/WP/IR_WP2016_01.pdf First version, 2016

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Persistent link: https://EconPapers.repec.org/RePEc:iro:wpaper:1601

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