New Insights, New Perspectives
Chapter 9: Summary and Conclusion
INTRODUCTION This book examines how exporting inﬂuences ﬁrm innovation. Speciﬁcally, it examines whether exporting leads to ﬁrm innovation, how exporting inﬂuences innovation, and which ﬁrms (from which industries) stand to beneﬁt more from exporting. This chapter summarizes the ﬁndings, highlighting relevant contributions for research and practice. I also suggest directions for future research and acknowledge limitations. 9.2 SUMMARY OF FINDINGS I ﬁrst sought to address whether exporting makes ﬁrms more innovative. My basic assertion was that foreign market contact (via exporting) provides ﬁrms with exposure to diverse external knowledge inputs that they can use to increase innovative output. The ﬁndings conﬁrm that a ﬁrm can increase its ex post innovative productivity by participating in export markets. While these eﬀects diﬀered across dependent variables, exporting preceded innovation in all cases. The most interesting implications may be gleaned from juxtaposing the ﬁndings for product innovations against those for patent applications. Firms that become exporters in a given year experience more product innovation the following year. However, it takes ﬁrms far longer to realize those gains on the patent side. The ﬁrm that becomes an exporter this year does not experience increased patent activity until three years later. Because the product innovation dependent variable includes improvements and modiﬁcations to existing products, this result likely captures the eﬀect of consumer feedback on the learning process. That is, ﬁrms gather market knowledge from their customers and quickly respond to market feedback by modifying their product o...
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