Innovation, Exports and Productivity: Learning and Self selection in Chile

Both exports and innovation (in particular, research and development) are key factors for the growth of firms and economies, but there has been little study of their combined impact on them, especially in developing countries. This article uses plant-level data from Chile to examine the relationship between productivity, R&D expenditure, and exports. We find that firms that invest in R&D are considerably more likely to export, but the reverse is not true. Even though exporting does not stimulate investment in R&D, both exports and R&D have a joint effect on improving productivity. These results allow us to recover the private return to “learning by exporting” across different sectors.