Innovation, Productivity and Exports: the Case of Hungary

This paper estimates the relationship between innovation and firm performance by using Community Innovation Survey data for Hungary. It exploits the possibility of linking the innovation data to ownership and disaggregated trade data. Innovative firms are more productive, more likely to trade and export into more countries. Foreign firms are more likely to innovate compared to similar domestic firms, but the amount of R&D is a weaker predictor of the innovative output of foreign firms.