Are Innovation and Internationalization Related? An Analysis of European Countries

Industry and Innovation, Andrea Filippetti, Marion Frenz & Grazia Ietto-Gillies, eds., Vol. 18, No. 5, pp. 437-459, 2011

Posted: 6 Nov 2011

See all articles by Andrea Filippetti

Andrea Filippetti

Italian National Research Council (CNR-ISSIRFA); London School of Economics & Political Science (LSE); University of London - Birkbeck College

Date Written: November 4, 2011

Abstract

This paper examines the relationship between countries' international profile and their innovation performance using data for 32 European countries. The overall contribution of the paper lies in: (a) an in-depth exploration of empirical correlations between innovation and several indicators of internationalization; and (b) the use of theoretical arguments - backed up by the literature - on why the observed correlations are not spurious but indicative of possible causality. Indicators of internationalization are considered with respect to each country as aggregate, to its technology-intensive industries only, and in relation to the share of its firms reporting international activities. On the basis of the empirical results, and the theoretical arguments presented, the paper suggests that underpinning the association is a virtuous (or vicious) circle: innovative firms are more successful in competing internationally and the exposure to alternative business and innovation contexts leads to innovation.

Keywords: innovation, internationalization

JEL Classification: O31, F21, P33

Suggested Citation

Filippetti, Andrea, Are Innovation and Internationalization Related? An Analysis of European Countries (November 4, 2011). Industry and Innovation, Andrea Filippetti, Marion Frenz & Grazia Ietto-Gillies, eds., Vol. 18, No. 5, pp. 437-459, 2011, Available at SSRN: https://ssrn.com/abstract=1954883

Andrea Filippetti (Contact Author)

Italian National Research Council (CNR-ISSIRFA) ( email )

Via dei Taurini, 19
00185 Rome
Italy

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

University of London - Birkbeck College ( email )

Malet Street
London, WC1E 7HX
United Kingdom

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