Research Paper

Of chickens and eggs: Exporting, innovation novelty and productivity

ERC Research paper No 101

Associated Themes
  • Innovation
  • Internationalisation
  • Productivity and performance

While it is well-known that exporters are more productive than non-exporters it is less clear why. Is it simply that more productive firms export (the Learning to Export hypothesis)? Or, is it exporting which leads to higher productivity (the Learning by Exporting hypothesis)? The distinction is important as each hypothesis points to very different policy and strategic prescriptions. Here, we use GMM estimation and data on a large, unbalanced panel of UK firms to expose the complex interlinkages between exporting and export persistence, innovation and innovation novelty and productivity.