Scandinavian Working Papers in Economics
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Department of Industrial Economics, Blekinge Institute of Technology Working Papers

No 2014/06:
Closing the Gap: An Empirical Evidence on Firmís Innovation, Productivity, and Exports

Sam Tavassoli () and Viroj Jienwatcharamongkhol ()

Abstract: It is well known that exporters are productive firms. But the source of their productivity is left unexplained. This paper aims to endogenize the productivity heterogeneity of exporting firms by incorporating innovation in a structural model framework. In doing so, we close the gap between the innovation-productivity and productivity-export literature. Two waves of Swedish Community Innovation Survey (CIS) are merged. This allows for a setup that takes into account the links from innovation input to innovation output and also from innovation output to productivity and exports. The main findings highlight that exporters are productive firms with innovation output in the past, which in turn was driven by prior R&D and other innovation activity investments.

Keywords: innovation; productivity; export; firm-level; structural model; community innovation survey; (follow links to similar papers)

JEL-Codes: C31; L60; O31; (follow links to similar papers)

28 pages, June 1, 2014

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