Journal
JOURNAL OF INTERNATIONAL BUSINESS STUDIES
Volume 42, Issue 1, Pages 56-75Publisher
PALGRAVE MACMILLAN LTD
DOI: 10.1057/jibs.2010.36
Keywords
exports; innovation; product innovation; process innovation; productivity
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Successful product innovation leads to the decision by small and medium enterprises (SMEs) to enter the export market. We argue that in addition to a direct effect of innovation on exports, product innovation, through its effect on firm productivity, increases the likelihood of the firm entering the export market. Using a panel of Spanish manufacturing firms, we show that the strong positive association found between firm productivity and exports in the literature relates to the firm's earlier innovation decisions, and that, when controlling for product innovation, the relationship between productivity and exports vanishes for these innovating firms. Journal of International Business Studies (2011) 42, 56-75. doi:10.1057/jibs.2010.36
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