The Role of Innovation on Export Performance of Kermanshah manufacturing firms

With a glance at the current situation of world countries can be developed and the developing countries into two categories divided. Significantly, the technology gap in developing countries than in developed countries is that competitiveness gap between developing countries and developed countries are. Therefore, it should be stated, the technology gap is the low share of Islamic countries, including Iran, the world s exports.This paper examines the impact of product innovation on export performance of Iran manufacturing firms, with a particular emphasis on the endogenous link between in- novation and exporting. Using a merged dataset of the fourth Community Innovation Survey (CIS4) and the Enquete Annuelle d’Entreprises (EAE) for the period 2007-2014, we find that product innovation is a main factor driving export behavior (both in terms of export participation and export intensity) while there is no such evidence for process innovation. Results also show that engaging in product innovation significantly increases the probability to start exporting. These findings regarding the decisive role of product innovations are in line with recent theoretical models that provide a more nuanced characterization of the firm self-selection process. They have important consequences in terms of public policy support for innovation

Keywords:

performance , innovation , exporting performance , Iran manufacturing firms