Dynamics of Innovation and Internationalization among Small and Medium-Sized Enterprises in Viet Nam

Trinh Long

No 580, ADBI Working Papers from Asian Development Bank Institute

Abstract: This paper examines the bidirectional causality between innovation and internationalization in the context of developing countries. Using a dynamic bivariate probit model and adopting a broad definition of internationalization, this paper analyzes these issues using a panel dataset of small and medium-sized enterprises in Viet Nam. The results show a high persistence in process and product innovations and internationalization decisions. Furthermore, we find that, for non-micro firms, past internationalization has a positive effect on process innovation, but past process innovation does not have a significant effect on the internationalization decision. For this group of firms, we also find signs of cross-dependence between process innovation and the internationalization decision. Our results, however, do not show dynamic interdependence between internationalization and product innovation.

Keywords: SME internationalization and innovation; process innovation; cross-dependence; product innovation (search for similar items in EconPapers)
JEL-codes: L20 L25 O31 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2016-08-16
New Economics Papers: this item is included in nep-cse, nep-ent, nep-ino, nep-sbm, nep-sea, nep-tid and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:adbiwp:0580

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