Innovation boosts exports and productivity for small firms in Spain.
The study looked at how innovation, productivity, and exports are connected in Spanish manufacturing firms from 1990-1998. The researchers found that firms that innovate are more likely to have higher productivity and export their products. Small firms that innovate show no difference in productivity between exporters and non-exporters. Product innovation plays a big role in the link between exports and productivity. However, small firms that don't innovate and have low to medium productivity levels still see higher productivity in exporting firms compared to non-exporting ones.