Process and product innovations, multi-product status and export performance: firm-level evidence from V?4 countries
DOI:
https://doi.org/10.24136/eq.2018.012Keywords:
export activity, firm heterogeneity, process and product innovations, multi-product status, Visegrad countriesAbstract
Research background: In this paper, we study empirically the relationship between different forms of innovations, multi-product status and export performance of firms from four Visegrad countries. We treat innovations as the key element that can increase the level of firm productivity.
Purpose of the article: The main objective is to analyze the empirical relationship between different firms of innovation of firms from Visegrad countries and their export performance. In contrast to previous studies that use R&D spending as a measure of innovation, we rather relay on innovation outcomes. Our detailed hypotheses postulate the existence of positive relationships between firm export performance and different forms of innovation. We seek to determine which type of innovation activity is of the greatest importance for exporting and whether it depends on firm size, the level of internationalization, the use of human capital and its sector of activity. In addition, we control for the multi-product status of firms, i.e. whether they sell one or many products.
Methods: The measures of innovative activity of companies include both spending on R&D as well as its effects, such as product and process innovations. In addition, we control for the multi-product status measured by the share of the main product in total sales of the firm, as well as for other firm-level characteristics. The empirical implementation of the theoretical framework is based on the probit models, applied to the fifth edition of BEEPS firm level data set covering the period 2011?2014.
Findings & Value added: Our results indicate that the probability of exporting is positively related to both product and process innovations and the multi-product status. In addition, we find that the probability of exporting is related to the set of control variables including labor productivity, firm size, the share of university graduates in productive employment, foreign capital participation and the use of foreign licenses.
Downloads
References
Allanson, P., & Montagna C. (2005). Multiproduct firms and market structure: an explorative application to the product life cycle. International Journal of Industrial Organization, 23(7–8).
DOI: https://doi.org/10.1016/j.ijindorg.2005.02.001
View in Google Scholar
Atkeson A, & Burstein A. (2007). Innovation, firm dynamics, and international trade. NBER Working Paper, 13326.
DOI: https://doi.org/10.3386/w13326
View in Google Scholar
Becker, S. O. & Egger, P. H. (2013). Endogenous product versus process innovation and a firm’s propensity to export. Empirical Economics, 44(1).
DOI: https://doi.org/10.1007/s00181-009-0322-6
View in Google Scholar
Békés, G., Muraközy, B., & Harasztosi, P., (2011). Firms and products in international trade: Evidence from Hungary. Economic Systems, 35(1).
DOI: https://doi.org/10.1016/j.ecosys.2010.11.005
View in Google Scholar
Békés, G., Muraközy, B. (2012). Temporary trade and heterogeneous firms. Journal of International Economics, 87(2).
DOI: https://doi.org/10.1016/j.jinteco.2011.12.007
View in Google Scholar
Bernard, A., & Jensen, J. B. (1999). Exceptional export performance: cause, effect, or both?. Journal of International Economics, 47(1).
DOI: https://doi.org/10.1016/S0022-1996(98)00027-0
View in Google Scholar
Bernard, A. B., Redding, S. J., & Schott, P. K. (2010). Multiple-product firms and product switching. American Economic Review, 100(1).
DOI: https://doi.org/10.1257/aer.100.1.70
View in Google Scholar
Brodzicki, T. (2016). Innovation intensity as a driver of firm’s internationalization intensity. Evidence for Poland. Ekonomia, Rynek, Gospodarka, Społeczeństwo, 46.
View in Google Scholar
Brodzicki, T., (2017). Internationalisation and innovation intensities of Polish manufacturing firms: a close nexus? Entrepreneurial Business and Economics Review, 5(1). doi: 10.15678/EBER.2017.050106.
DOI: https://doi.org/10.15678/EBER.2017.050106
View in Google Scholar
Brodzicki, T., & Ciołek, D. (2016). Determinanty działalności eksportowej polskich firm produkcyjnych. Gospodarka Narodowa, 86/87(2).
View in Google Scholar
Caldera, A. (2010). Innovation and exporting: evidence from Spanish manufacturing firms. Review of World Economy, 146(4).
DOI: https://doi.org/10.1007/s10290-010-0065-7
View in Google Scholar
Cassiman, B., Golovko, E., & Martínez-Ros, E. (2010). Innovation, exports and productivity. International Journal of Industrial Organization, 28(4).
DOI: https://doi.org/10.1016/j.ijindorg.2010.03.005
View in Google Scholar
Cieślik, A., Michałek, J., & Michałek, A. (2012a). Determinanty działalności eksportowej polskich przedsiębiorstw. Gospodarka Narodowa, 80/81(7-8).
View in Google Scholar
Cieślik, A., Michałek, J., & Szczygielski, K. (2016). Innovations and export performance: firm-level evidence from Poland. Entrepreneurial Business and Economics Review, 4(4). doi: 10.15678/EBER.2017.050205.
View in Google Scholar
Cieślik, A., & Michałek, J. (2016). Innowacje a działalność eksportowa polskich przedsiębiorstw. International Business and Global Economy, 2(2). Doi: 10.4467/23539496IB.16.067.5648.
View in Google Scholar
Cieślik, A., & Michałek, J. (2017a). Innovations and export performance of new EU member states. Ekonomista, 5.
View in Google Scholar
Cieślik, A., & Michałek, J. (2017b). Innovation forms and firm export performance: empirical evidence from ECA countries. Entrepreneurial Business and Economics Review, 5(2). doi: 10.15678/EBER.2017.050205.
DOI: https://doi.org/10.15678/EBER.2017.050205
View in Google Scholar
Cieślik, A., Michałek J., Michałek, A. (2012b). Export activity in Visegrad 4 countries: firm level investigation. Ekonomia, Rynek, Gospodarka, Społeczeństwo, 30.
View in Google Scholar
Cieślik, A., Michałek, J., & Michałek, A. (2014). The influence of firm characteristics and export performance in Central and Eastern Europe: comparisons of Visegrad, Baltic and Caucasus States. Entrepreneurial Business and Economics Review, 2(1). doi: 10.15678/EBER.2014.020102.
DOI: https://doi.org/10.15678/EBER.2014.020102
View in Google Scholar
Cieślik, A., Michałek, J., Michałek, A., & Mycielski, J. (2015). Determinants of export performance: comparison of Central European and Baltic firms. Finance a Uver, 65(3).
DOI: https://doi.org/10.12775/EQUIL.2015.026
View in Google Scholar
Cieślik, A., Michałek, J., & Szczygielski, K. (2016). Innovations and export performance: firm-level evidence from Poland. Entrepreneurial Business and Economics Review, 4(4). doi: 10.15678/EBER.2016.040402.
DOI: https://doi.org/10.15678/EBER.2016.040402
View in Google Scholar
Constantini, J. A., & Melitz, M. J. (2008). The dynamics of firm-level adjustment to trade liberalization. In: E. Helpman, D. Marin, & T. Verdier (Eds.). The organization of firms in a global economy. Cambridge, MA: Harvard University Press.
View in Google Scholar
Costas, A., & Muendler, M. A. (2013). Exporters and their products: a collection of empirical regularities. CESifo Economic Studies, 59(2).
DOI: https://doi.org/10.1093/cesifo/ifs028
View in Google Scholar
Damijan, J. P., Kostevc, C., & Polanec, S. (2010). From innovation to exporting or vice versa? World Economy, 33(3). doi: 10.1111/j.1467-9701.2010.01260.x.
DOI: https://doi.org/10.1111/j.1467-9701.2010.01260.x
View in Google Scholar
Demidova, S., & Rodríguez-Clare, A. (2013). The simple analytics of the Melitz model in a small economy. Journal of International Economics, 90(2). doi: 10.1016/j.jinteco.2013.02.006.
DOI: https://doi.org/10.1016/j.jinteco.2013.02.006
View in Google Scholar
Ebling, G., & Janz, N. (1999). Export and innovation activities in the German service sector. Empirical evidence at the firm level. Zentrum fur Europäische Wirtschaftsforschung. ZEW discussion paper. 99–53.
View in Google Scholar
Gkypali, A., Rafailidis, A., & Tsekouras, K. (2015). Innovation and export performance: do young and mature innovative firms differ?. Eurasian Business Review, 5(2). doi: 10.1007/s40821-015-0030-4.
DOI: https://doi.org/10.1007/s40821-015-0030-4
View in Google Scholar
Jung, B. (2012). Optimal fixed cost subsidies in Melitz-type models. Empirica, 39(1). doi: 10.1007/s10663-010-9165-9.
DOI: https://doi.org/10.1007/s10663-010-9165-9
View in Google Scholar
Lachenmaier, S., & Wößmann, L. W. (2006). Does innovation cause exports? Evidence from exogenous innovation impulses and obstacles using German micro data. Oxford Economic Papers, 58(2).
DOI: https://doi.org/10.1093/oep/gpi043
View in Google Scholar
Mairesse, J., & Mohnen, P. (2010). Using innovation surveys for econometric analysis. In B. H. Hall & N. Rosenberg (Eds.). Economics of innovations, Vol. 2. Amsterdam: North-Holland.
DOI: https://doi.org/10.3386/w15857
View in Google Scholar
Melitz, M. J. (2003). The impact of trade on intra-industry reallocations and aggregate industry productivity. Econometrica, 71(6). doi: 10.1111/1468-0262.0046.
DOI: https://doi.org/10.1111/1468-0262.00467
View in Google Scholar
Melitz, M. J., & Ottaviano, G. (2008). Market size, trade, and productivity. Review of Economic Studies, 75(1).
DOI: https://doi.org/10.1111/j.1467-937X.2007.00463.x
View in Google Scholar
Redding, S. J., & Melitz, M. J. (2014). Heterogeneous firms and trade. Handbook of International Economics, 4.
View in Google Scholar
Roper, S., & Love, J. H. (2002). Innovation and export performance: evidence from the UK and German manufacturing plants. Research Policy, 31(7).
DOI: https://doi.org/10.1016/S0048-7333(01)00175-5
View in Google Scholar
Van Beveren, I., & Vandenbussche, H. (2010). Product and process innovation and firms' decision to export. Journal of Economic Policy Reform, 13(1).
DOI: https://doi.org/10.1080/17487870903546267
View in Google Scholar
Wagner, J. (2007). Exports and productivity: a survey of the evidence from firm-level data. World Economy, 30(1).
DOI: https://doi.org/10.1111/j.1467-9701.2007.00872.x
View in Google Scholar
Wagner, J. (2012). International trade and firm performance: a survey of empirical studies since 2006. Review of World Economy, 148(2).
DOI: https://doi.org/10.1007/s10290-011-0116-8
View in Google Scholar
Wakelin, K. (1998). Innovation and export behaviour at the firm level. Research Policy, 26(7–8).
DOI: https://doi.org/10.1016/S0048-7333(97)00051-6
View in Google Scholar
