The 45 references with contexts in paper Christopher F Baum, Mustafa Caglayan, Oleksandr Talavera (2012) “R&D Expenditures and Geographical Sales Diversification” / RePEc:boc:bocoec:794

1
Acs, Z. J. & Audretsch, D. B. (1988), ‘Innovation in large and small firms: An empirical analysis’,American Economic Review78(4), 678–90.
Total in-text references: 2
  1. In-text reference with the coordinate start=3769
    Prefix
    According to Porter (1990), innovation can help a firm achieve a competitive advantage in international markets over potential competitors. Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See
    Exact
    Acs & Audretsch (1988), Mairesse & Mohnen (2005).
    Suffix
    3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.

  2. In-text reference with the coordinate start=12795
    Prefix
    They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines
    Exact
    Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005).
    Suffix
    11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that w

2
Aw, B. Y., Roberts, M. J. & Winston, T. (2007), ‘Export market participation, investments in R&D and worker training, and the evolution of firm productivity’,The World Economy 30(1), 83–104.
Total in-text references: 1
  1. In-text reference with the coordinate start=12624
    Prefix
    Clerides et al. (1998) argue that the stochastic processes that generate cost and productivity trajectories should improve with changes in exporting status if learning-by-exporting plays an important role. They provide evidence using data from Mexico, Colombia and Morocco.
    Exact
    Salomon & Shaver (2005) and Aw et al. (2007)
    Suffix
    recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Doll

3
Aw, B. Y., Roberts, M. J. & Xu, D. Y. (2011), ‘R&D investment, exporting, and productivity dynamics’,American Economic Review101(4), 1312–44.
Total in-text references: 1
  1. In-text reference with the coordinate start=13642
    Prefix
    relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample. Hall et al. (2009) show that enhanced international competition leads to higher levels of R&D, while Damijan et al. (2010) find that exporting influences innovation. More recently,
    Exact
    Aw et al. (2011)
    Suffix
    develop a dynamic framework to model exporting and R&D and show that current R&D directly impacts the probability of exporting, while current exporting alters the return to R&D. They present evidence that exporting enhances productivity, while exporting firms invest more in R&D.

4
Barrios, S., Goerg, H. & Strobl, E. (2003), ‘Explaining firms’ export behaviour: R&D, spillovers and the destination market’,Oxford Bulletin of Economics and Statistics 65(4), 475–496.
Total in-text references: 1
  1. In-text reference with the coordinate start=11567
    Prefix
    productivity and gain a competitive edge over its rivals in the domestic and foreign markets.10As detailed data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including
    Exact
    Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004),
    Suffix
    Roper et al. (2006), Girma et al. (2008), and Harris & Li (2009), investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer prefere

5
Baum, C. F., Caglayan, M. & Talavera, O. (2013), ‘The effects of future capital investment and R&D expenditures on firms’ liquidity’,Review of International Economics13(3), 459– 474.
Total in-text references: 1
  1. In-text reference with the coordinate start=31695
    Prefix
    Though it would be interesting to examine factors that promote homeversusforeign R&D activities as data become available, our main concern is the behavior of firms’ total R&D expenditures. 25For an overview of this literature, see
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    Baum et al. (2013).
    Suffix
    16 tion; (ii) the possibility of reverse causality; (iii) the subset of positive R&D firms as we scrutinize both directions of causality; and (iv) separating domestic sales from exports to other European markets. 4.3.

6
Bishop, P. & Wiseman, N. (1999), ‘External ownership and innovation in the United Kingdom’,Applied Economics31(4), 443–450.
Total in-text references: 1
  1. In-text reference with the coordinate start=3929
    Prefix
    Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example,
    Exact
    Bishop & Wiseman (1999) and Blind & Jungmittag (2004).
    Suffix
    5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging. Doukas & Pantzalis (2003) document that the effects of agency 3 lar, having access to a wider customer base may encourage a firm to innovate via increased R&D activities, as innovation allows the company to achieve strategic competitiveness.

7
Bleaney, M. & Wakelin, K. (2002), ‘Efficiency, innovation and exports’,Oxford Bulletin of Economics and Statistics64(1), 3–15.
Total in-text references: 1
  1. In-text reference with the coordinate start=11567
    Prefix
    productivity and gain a competitive edge over its rivals in the domestic and foreign markets.10As detailed data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including
    Exact
    Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004),
    Suffix
    Roper et al. (2006), Girma et al. (2008), and Harris & Li (2009), investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer prefere

8
Blind, K. & Jungmittag, A. (2004), ‘Foreign direct investment, imports and innovations in the service industry’,Review of Industrial Organization25(2), 205–227.
Total in-text references: 1
  1. In-text reference with the coordinate start=3929
    Prefix
    Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example,
    Exact
    Bishop & Wiseman (1999) and Blind & Jungmittag (2004).
    Suffix
    5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging. Doukas & Pantzalis (2003) document that the effects of agency 3 lar, having access to a wider customer base may encourage a firm to innovate via increased R&D activities, as innovation allows the company to achieve strategic competitiveness.

9
Brown, J. R., Fazzari, S. M. & Petersen, B. C. (2009), ‘Financing innovation and growth: Cash flow, external equity, and the 1990s R&D boom’,Journal of Finance64(1), 151–185. 23
Total in-text references: 1
  1. In-text reference with the coordinate start=30612
    Prefix
    These results are not surprising: (i) R&D investment contributes to the stock of intangible capital and cannot be used as collateral; and (ii) R&D expenditures have a lengthy and highly uncertain payback. In our investigation, we also consider the findings of
    Exact
    Brown et al. (2009) and Carpenter & Petersen (2002)
    Suffix
    as we evaluate whether new equity issuance plays an important role, over and above the effects of leverage and cash holdings. This is reasonable, as financing R&D activities through the issuance of equity may be particularly important for those firms that are severely restricted due to inadequate internal funds.

10
Carpenter, R. E. & Petersen, B. C. (2002), ‘Capital market imperfections, high-tech investment, and new equity financing’,Economic Journal112(477), F54–F72.
Total in-text references: 1
  1. In-text reference with the coordinate start=30612
    Prefix
    These results are not surprising: (i) R&D investment contributes to the stock of intangible capital and cannot be used as collateral; and (ii) R&D expenditures have a lengthy and highly uncertain payback. In our investigation, we also consider the findings of
    Exact
    Brown et al. (2009) and Carpenter & Petersen (2002)
    Suffix
    as we evaluate whether new equity issuance plays an important role, over and above the effects of leverage and cash holdings. This is reasonable, as financing R&D activities through the issuance of equity may be particularly important for those firms that are severely restricted due to inadequate internal funds.

11
Clerides, S. K., Lach, S. & Tybout, J. R. (1998), ‘Is learning by exporting important? Micro-dynamic evidence from Colombia, Mexico, and Morocco’,The Quarterly Journal of Economics113(3), 903–947.
Total in-text references: 1
  1. In-text reference with the coordinate start=12340
    Prefix
    It is equally important to recognize the possibility that more vigorous competition and differing consumer preferences in foreign markets may induce firms to carry out R&D activities so that they can improve their innovative capabilities and stay ahead of their rivals: i.e. the so calledlearning by exportinghypothesis.12However, there is only a handful of studies that evaluate this hypothesis.
    Exact
    Clerides et al. (1998)
    Suffix
    argue that the stochastic processes that generate cost and productivity trajectories should improve with changes in exporting status if learning-by-exporting plays an important role. They provide evidence using data from Mexico, Colombia and Morocco.

12
Cohen, W. M. & Levinthal, D. A. (1989), ‘Innovation and learning: The two faces of R&D’, Economic Journal
Total in-text references: 2
  1. In-text reference with the coordinate start=3838
    Prefix
    Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance,
    Exact
    Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009).
    Suffix
    4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.

  2. In-text reference with the coordinate start=12795
    Prefix
    They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines
    Exact
    Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005).
    Suffix
    11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that w

13
Cohen, W. M. & Levinthal, D. A. (1990), ‘Absorptive capacity: A new perspective on learning and innovation’,Administrative Science Quarterly35, 128–152.
Total in-text references: 1
  1. In-text reference with the coordinate start=12795
    Prefix
    They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines
    Exact
    Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005).
    Suffix
    11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that w

14
Czarnitzki, D. & Toole, A. A. (2011), ‘Patent protection, market uncertainty, and R&D investment’,The Review of Economics and Statistics93(1), 147–159.
Total in-text references: 1
  1. In-text reference with the coordinate start=15698
    Prefix
    (2005) and De Loecker (2007) who find that productivity increases after firms enter the export market in Ivory Coast and Slovenia, respectively. 8 for this category of expenditure in a given year. However, in a standard regression context, the empirical distribution of the series due to the prevalence of zero values is neglected. In confronting this issue, some authors (e.g.,
    Exact
    Czarnitzki & Toole (2011))
    Suffix
    have made use of censored normal regression techniques such as the Tobit model. In our empirical investigation we, too, make extensive use of the Tobit model. The second difficulty in estimating the effects of diversification on R&D expenditures is the endogeneity problem.

15
Damijan, J. P., Kostevc, C. & Polanec, S. (2010), ‘From innovation to exporting or vice versa?’,The World Economy33(3), 374–398.
Total in-text references: 1
  1. In-text reference with the coordinate start=13558
    Prefix
    Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample. Hall et al. (2009) show that enhanced international competition leads to higher levels of R&D, while
    Exact
    Damijan et al. (2010)
    Suffix
    find that exporting influences innovation. More recently, Aw et al. (2011) develop a dynamic framework to model exporting and R&D and show that current R&D directly impacts the probability of exporting, while current exporting alters the return to R&D.

16
De Loecker, J. (2007), ‘Do exports generate higher productivity? Evidence from Slovenia’, Journal of International Economics73(1), 69–98.
Total in-text references: 1
  1. In-text reference with the coordinate start=15323
    Prefix
    In any sample of firm-level data, it is likely that a number of firms will report zero values 13It is equally possible as Kotabe (1990) suggests that diversified firms have easier access to financial resources allowing them to smooth their R&D expenditures. 14Also see Van Biesebroeck (2005) and De
    Exact
    Loecker (2007)
    Suffix
    who find that productivity increases after firms enter the export market in Ivory Coast and Slovenia, respectively. 8 for this category of expenditure in a given year. However, in a standard regression context, the empirical distribution of the series due to the prevalence of zero values is neglected.

17
Denis, D. J., Denis, D. K. & Yost, K. (2002), ‘Global diversification, industrial diversification, and firm value’,Journal of Finance57(5), 1951–1979.
Total in-text references: 1
  1. In-text reference with the coordinate start=5846
    Prefix
    Our empirical model takes into account several firmspecific factors including the effects of foreign productive assets, size, leverage, cash holdings, costs on long term debt are exacerbated by the degree of firms’ foreign involvement (p. 89). Some researchers suggest global diversification can reduce shareholder wealth (e.g.,
    Exact
    Denis et al. (2002)),
    Suffix
    while Doukas & Kan (2006) argue against this claim. 6Hitt et al. (1997) use averages of the data over 1998–1990 to smooth annual fluctuations in observed variables; see p. 778. 7Researchers have studied the effects of international diversifications on stock market valuation of firms: Dos Santos et al. (2008) find that a significant valuation discount applies to product diversification but not to i

18
Dollar, D. (1986), ‘Technological innovations, capital mobility, and the product cycle in
Total in-text references: 1
  1. In-text reference with the coordinate start=13029
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by
    Exact
    Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995).
    Suffix
    12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

20
Dos Santos, M. B., Errunza, V. R. & Miller, D. P. (2008), ‘Does corporate international diversification destroy value? Evidence from cross-border mergers and acquisitions’,Journal of Banking & Finance32(12), 2716–2724. 24
Total in-text references: 1
  1. In-text reference with the coordinate start=6152
    Prefix
    Some researchers suggest global diversification can reduce shareholder wealth (e.g., Denis et al. (2002)), while Doukas & Kan (2006) argue against this claim. 6Hitt et al. (1997) use averages of the data over 1998–1990 to smooth annual fluctuations in observed variables; see p. 778. 7Researchers have studied the effects of international diversifications on stock market valuation of firms: Dos
    Exact
    Santos et al. (2008)
    Suffix
    find that a significant valuation discount applies to product diversification but not to international diversification. Ursacki & Vertinsky (1992) suggest that multinational banks may benefit from broadening the geographical scope of their business. 4 new equity issuance and cash flow to control for firm heterogeneity.

21
Doukas, J. A. & Kan, O. B. (2006), ‘Does global diversification destroy firm value?’,Journal of International Business Studies37(3), 352–371.
Total in-text references: 1
  1. In-text reference with the coordinate start=5874
    Prefix
    Our empirical model takes into account several firmspecific factors including the effects of foreign productive assets, size, leverage, cash holdings, costs on long term debt are exacerbated by the degree of firms’ foreign involvement (p. 89). Some researchers suggest global diversification can reduce shareholder wealth (e.g., Denis et al. (2002)), while
    Exact
    Doukas & Kan (2006)
    Suffix
    argue against this claim. 6Hitt et al. (1997) use averages of the data over 1998–1990 to smooth annual fluctuations in observed variables; see p. 778. 7Researchers have studied the effects of international diversifications on stock market valuation of firms: Dos Santos et al. (2008) find that a significant valuation discount applies to product diversification but not to international diversificati

22
Doukas, J. A. & Pantzalis, C. (2003), ‘Geographic diversification and agency costs of debt of multinational firms’,Journal of Corporate Finance9(1), 59–92.
Total in-text references: 1
  1. In-text reference with the coordinate start=4130
    Prefix
    capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.
    Exact
    Doukas & Pantzalis (2003)
    Suffix
    document that the effects of agency 3 lar, having access to a wider customer base may encourage a firm to innovate via increased R&D activities, as innovation allows the company to achieve strategic competitiveness.

23
Girma, S., Georg, H. & Hanley, A. (2008), ‘R&D and exporting: A comparison of British and Irish firms’,Review of World Economics (Weltwirtschaftliches Archiv)144(4), 750–773.
Total in-text references: 2
  1. In-text reference with the coordinate start=11682
    Prefix
    data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004), Roper et al. (2006),
    Exact
    Girma et al. (2008), and Harris & Li (2009),
    Suffix
    investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer preferences in foreign markets may induce firms to carry out R&D activiti

  2. In-text reference with the coordinate start=12740
    Prefix
    et al. (1998) argue that the stochastic processes that generate cost and productivity trajectories should improve with changes in exporting status if learning-by-exporting plays an important role. They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation.
    Exact
    Girma et al. (2008)
    Suffix
    investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2

24
Greenaway, D. & Kneller, R. (2007), ‘Firm heterogeneity, exporting and foreign direct investment’,Economic Journal117(517), F134–F161.
Total in-text references: 1
  1. In-text reference with the coordinate start=13133
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See
    Exact
    Greenaway & Kneller (2007) and Wagner (2005)
    Suffix
    for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

25
Greene, W. (2004), ‘Fixed effects and bias due to the incidental parameters problem in the Tobit model’,Econometric Reviews23(2), 125–147.
Total in-text references: 1
  1. In-text reference with the coordinate start=32752
    Prefix
    indicate that this is perhaps the most important distinguishing characteristic of R&D investment, and leads to firms’ smoothing R&D spending over time so that they may retain their skilled human capital. In the context of instrumental variables Tobit modeling, adding the lagged dependent variable to capture the smooth behavior of R&D expenditures leads to a downward bias in the estimates (see
    Exact
    Greene (2004)).
    Suffix
    However, this bias is likely to decline as the time series dimension of the panel increases. Given that most firms in our data have a reasonably long time series (1990–2008), the effect of this bias can be expected to be minimal.

26
Greenhalgh, C., Taylor, P. & Wilson, R. (1994), ‘Innovation and export volumes and prices–a disaggregated study’,Oxford Economic Papers46(1), 102–35.
Total in-text references: 1
  1. In-text reference with the coordinate start=13029
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by
    Exact
    Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995).
    Suffix
    12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

27
Grossman, G. & Helpman, E. (1995),Technology and Trade, Elsevier.
Total in-text references: 1
  1. In-text reference with the coordinate start=13029
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by
    Exact
    Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995).
    Suffix
    12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

28
Hall, B., Lotti, F. & Mairesse, J. (2009), ‘Innovation and productivity in SMEs: Empirical evidence for Italy’,Small Business Economics33(1), 13–33.
Total in-text references: 1
  1. In-text reference with the coordinate start=13458
    Prefix
    (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.
    Exact
    Hall et al. (2009)
    Suffix
    show that enhanced international competition leads to higher levels of R&D, while Damijan et al. (2010) find that exporting influences innovation. More recently, Aw et al. (2011) develop a dynamic framework to model exporting and R&D and show that current R&D directly impacts the probability of exporting, while current exporting alters the return to R&D.

33
Harris, R. & Li, Q. C. (2009), ‘Exporting, R&D, and absorptive capacity in UK establishments’,Oxford Economic Papers61(1), 74–103. 25
Total in-text references: 2
  1. In-text reference with the coordinate start=3838
    Prefix
    Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance,
    Exact
    Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009).
    Suffix
    4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.

  2. In-text reference with the coordinate start=11682
    Prefix
    data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004), Roper et al. (2006),
    Exact
    Girma et al. (2008), and Harris & Li (2009),
    Suffix
    investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer preferences in foreign markets may induce firms to carry out R&D activiti

34
Harris, R. & Moffat, J. (2011), R&D, innovation and exporting, SERC Discussion Papers 0073, Spatial Economics Research Centre, LSE.
Total in-text references: 2
  1. In-text reference with the coordinate start=3085
    Prefix
    bring additional intangible benefits which may help firms overcome barriers to exporting.3In particular, given the availability of detailed firm-level data on export sales, researchers have begun to investigate the linkages between R&D expenditures and firms’ export behavior. Yet, this line of research has mostly focused on the question of whether R&D affects firms’ exports. However, as
    Exact
    Harris & Moffat (2011)
    Suffix
    suggest, exporting does not require prior R&D innovation. It is also recognized that exporting firms may access strategic knowledge, as exporting allows them to improve their innovative capacities.4 In this paper, in contrast to much of the literature, we hypothesize that firms operating in diversified export markets are more likely to engage in R&D activities.

  2. In-text reference with the coordinate start=10941
    Prefix
    & Lerner, Josh (2009) who argue that firms’ R&D expenditures are smoothed to maintain their stability. 9There is significant research that examines the role of R&D expenditures on exports which has shown that R&D expenditures facilitate firms’ entry into export markets. See
    Exact
    Harris & Moffat (2011)
    Suffix
    for an extensive review of this literature. 6 2. Literature Review It is well documented in the literature that in an imperfectly competitive market, an R&D–active firm can innovate, increase its productivity and gain a competitive edge over its rivals in the domestic and foreign markets.10As detailed data on firm-level exports and R&D expenditures have became availa

35
Hitt, M. A., Hoskisson, R. E. & Kim, H. (1997), ‘International diversification: Effects on innovation and firm performance in product-diversified firms’,The Academy of Management Journal40, 767–798.
Total in-text references: 4
  1. In-text reference with the coordinate start=4537
    Prefix
    (2003) document that the effects of agency 3 lar, having access to a wider customer base may encourage a firm to innovate via increased R&D activities, as innovation allows the company to achieve strategic competitiveness. Nevertheless, the literature on the potential association between export market diversification and R&D activities is meager. To our knowledge, the only study is by
    Exact
    Hitt et al. (1997)
    Suffix
    which investigates the linkages between innovation and firm performance, focusing on a cross section of 295 large US firms. They show that an entropy-based measure of international diversification has a positive effect on R&D intensity, measured as expenditures per employee (p. 785, Table 3).6However, most of the papers in this genre focus on the effects of R&D activities on firm performance rath

  2. In-text reference with the coordinate start=5919
    Prefix
    model takes into account several firmspecific factors including the effects of foreign productive assets, size, leverage, cash holdings, costs on long term debt are exacerbated by the degree of firms’ foreign involvement (p. 89). Some researchers suggest global diversification can reduce shareholder wealth (e.g., Denis et al. (2002)), while Doukas & Kan (2006) argue against this claim. 6
    Exact
    Hitt et al. (1997)
    Suffix
    use averages of the data over 1998–1990 to smooth annual fluctuations in observed variables; see p. 778. 7Researchers have studied the effects of international diversifications on stock market valuation of firms: Dos Santos et al. (2008) find that a significant valuation discount applies to product diversification but not to international diversification.

  3. In-text reference with the coordinate start=14399
    Prefix
    -by-exporting becomes even more crucial for firms exporting to countries further distant from their home markets, as they will face more competitive pressures and different consumer preferences.13We expect that as firms expand their export markets to different regions then their own, they may devote more resources to innovation in the form of R&D expenditures. Along these lines,
    Exact
    Hitt et al. (1997)
    Suffix
    focus on a cross section of 295 large US firms and show that international diversification has a positive effect on R&D intensity (p. 785, Table 2).14Yet, to our knowledge, there are no other studies that explore the importance of diversification of export markets on the firm’s R&D activities, as most of the research in this genre focuses on the effects of diversification on firm performance. 2.1.

  4. In-text reference with the coordinate start=19319
    Prefix
    Our second diversification measure is entropy-based and quantifies the expected value of the information contained in a specific realization of the random variable.16 16See Shannon (1948) for more along these lines. Note that
    Exact
    Hitt et al. (1997)
    Suffix
    also implement this measure. 10 The measure takes the following form: Diversification Entropyit=− ∑n r=1 xr,i,tlog(xr,i,t) where in the case ofxr,i,t= 0 for someiandt, the value of the corresponding term is taken to be 0, which is consistent with the well-known limit thatlimp→0+(plogp) = 0.

36
Kotabe, M. (1990), ‘The relationship between offshore sourcing and innovativeness of U.S. multinational firms: An empirical investigation’,Journal of International Business Studies 21(4), 623–638.
Total in-text references: 2
  1. In-text reference with the coordinate start=3621
    Prefix
    knowledge, as exporting allows them to improve their innovative capacities.4 In this paper, in contrast to much of the literature, we hypothesize that firms operating in diversified export markets are more likely to engage in R&D activities. According to Porter (1990), innovation can help a firm achieve a competitive advantage in international markets over potential competitors.
    Exact
    Kotabe (1990)
    Suffix
    suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational compa

  2. In-text reference with the coordinate start=15138
    Prefix
    Methodological Issues An important methodological issue arises when considering the modeling of our dependent variable, the ratio of R&D expenditures to total assets (TA), which is bounded from below. In any sample of firm-level data, it is likely that a number of firms will report zero values 13It is equally possible as
    Exact
    Kotabe (1990)
    Suffix
    suggests that diversified firms have easier access to financial resources allowing them to smooth their R&D expenditures. 14Also see Van Biesebroeck (2005) and De Loecker (2007) who find that productivity increases after firms enter the export market in Ivory Coast and Slovenia, respectively. 8 for this category of expenditure in a given year.

37
Krugman, P. (1979), ‘A model of innovation, technology transfer, and the world distribution of income’,Journal of Political Economy87(2), 253–66.
Total in-text references: 1
  1. In-text reference with the coordinate start=13029
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by
    Exact
    Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995).
    Suffix
    12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

38
Mairesse, J. & Mohnen, P. (2005), ‘The importance of R&D for innovation: A reassessment using French survey data’,The Journal of Technology Transfer30(2), 183–197.
Total in-text references: 2
  1. In-text reference with the coordinate start=3769
    Prefix
    According to Porter (1990), innovation can help a firm achieve a competitive advantage in international markets over potential competitors. Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See
    Exact
    Acs & Audretsch (1988), Mairesse & Mohnen (2005).
    Suffix
    3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009). 4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.

  2. In-text reference with the coordinate start=12795
    Prefix
    They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines
    Exact
    Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005).
    Suffix
    11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that w

39
Miranda, A. & Rabe-Hesketh, S. (2006), ‘Maximum likelihood estimation of endogenous switching and sample selection models for binary, ordinal, and count variables’,Stata Journal6(3), 285–308.
Total in-text references: 1
  1. In-text reference with the coordinate start=16527
    Prefix
    In this case we face the crucial problem of endogeneity which leads to biased estimates, as some explanatory variables are not orthogonal to the error process. We employ two approaches to address this important issue. First, we make use of the instrumental variables maximum likelihood Tobit estimator
    Exact
    (Miranda & Rabe-Hesketh (2006)),
    Suffix
    employing second and third lags of endogenous variables as instruments. The validity of these instruments is gauged by an overidentification test. Second, we consider reverse causality as a robustness check, and reestimate the model using the diversification measure as the dependent variable.15 3.

40
Ozcelik, E. & Taymaz, E. (2004), ‘Does innovativeness matter for international competitiveness in developing countries?: The case of Turkish manufacturing industries’,Research Policy33(3), 409–424.
Total in-text references: 1
  1. In-text reference with the coordinate start=11567
    Prefix
    productivity and gain a competitive edge over its rivals in the domestic and foreign markets.10As detailed data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including
    Exact
    Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004),
    Suffix
    Roper et al. (2006), Girma et al. (2008), and Harris & Li (2009), investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer prefere

41
Porter, M. (1990),The competitive advantage of nations, Free Press.
Total in-text references: 1
  1. In-text reference with the coordinate start=3495
    Prefix
    It is also recognized that exporting firms may access strategic knowledge, as exporting allows them to improve their innovative capacities.4 In this paper, in contrast to much of the literature, we hypothesize that firms operating in diversified export markets are more likely to engage in R&D activities. According to
    Exact
    Porter (1990),
    Suffix
    innovation can help a firm achieve a competitive advantage in international markets over potential competitors. Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance, Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (200

42
Posner, M. (1961), ‘International trade and technical change’,Oxford Economic Papers 13, 323–341. 26
Total in-text references: 1
  1. In-text reference with the coordinate start=13029
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by
    Exact
    Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995).
    Suffix
    12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

45
Salomon, R. M. & Shaver, J. M. (2005), ‘Learning by exporting: New insights from examining firm innovation’,Journal of Economics & Management Strategy14(2), 431–460.
Total in-text references: 1
  1. In-text reference with the coordinate start=12624
    Prefix
    Clerides et al. (1998) argue that the stochastic processes that generate cost and productivity trajectories should improve with changes in exporting status if learning-by-exporting plays an important role. They provide evidence using data from Mexico, Colombia and Morocco.
    Exact
    Salomon & Shaver (2005) and Aw et al. (2007)
    Suffix
    recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Doll

46
Shannon, C. E. (1948), ‘A mathematical theory of communication’,The Bell System Technical Journal27, 379–423.
Total in-text references: 1
  1. In-text reference with the coordinate start=19265
    Prefix
    The highest possible value of this measure is 0.75, which corresponds to a HHI of 0.25, representing equal sales in each region. Our second diversification measure is entropy-based and quantifies the expected value of the information contained in a specific realization of the random variable.16 16See
    Exact
    Shannon (1948)
    Suffix
    for more along these lines. Note that Hitt et al. (1997) also implement this measure. 10 The measure takes the following form: Diversification Entropyit=− ∑n r=1 xr,i,tlog(xr,i,t) where in the case ofxr,i,t= 0 for someiandt, the value of the corresponding term is taken to be 0, which is consistent with the well-known limit thatlimp→0+(plogp) = 0.

47
Sterlacchini, A. (2001), ‘The determinants of export performance: A firm-level study of Italian manufacturing’,Review of World Economics (Weltwirtschaftliches Archiv) 137(3), 450–472.
Total in-text references: 1
  1. In-text reference with the coordinate start=11567
    Prefix
    productivity and gain a competitive edge over its rivals in the domestic and foreign markets.10As detailed data on firm-level exports and R&D expenditures have became available, empirical researchers have provided more detailed account of the linkages between R&D expenditures, productivity and exports. For instance, researchers using data from several countries, including
    Exact
    Sterlacchini (2001), Bleaney & Wakelin (2002), Barrios et al. (2003), Ozcelik & Taymaz (2004),
    Suffix
    Roper et al. (2006), Girma et al. (2008), and Harris & Li (2009), investigate whether R&D expenditures facilitate firms’ entry into export markets. The conclusion of this strand of literature is that firms that are heavily involved in R&D activities are more likely to be exporters.11 It is equally important to recognize the possibility that more vigorous competition and differing consumer prefere

48
Teece, D. & Pisano, G. (1998), The dynamic capabilities of firms: An introduction,in G. Dosi, T. D.J. & C. J., eds, ‘Technology, Organisation, and Competitiveness: Perspectives on Industrial and Corporate Change’, Oxford University Press, pp. 17–66.
Total in-text references: 2
  1. In-text reference with the coordinate start=3838
    Prefix
    Kotabe (1990) suggests that multinational firms may have better access to global resources to enhance their innovative capabilities.5In particu2See Acs & Audretsch (1988), Mairesse & Mohnen (2005). 3See, for instance,
    Exact
    Cohen & Levinthal (1989), Teece & Pisano (1998), and Harris & Li (2009).
    Suffix
    4See, for example, Bishop & Wiseman (1999) and Blind & Jungmittag (2004). 5Research has also shown that multinational companies are more susceptible to agency costs, as monitoring of such companies is more challenging.

  2. In-text reference with the coordinate start=12795
    Prefix
    They provide evidence using data from Mexico, Colombia and Morocco. Salomon & Shaver (2005) and Aw et al. (2007) recognize that learning-by-exporting can lead to increased innovation. Girma et al. (2008) investigate 10See along these lines
    Exact
    Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005).
    Suffix
    11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See Greenaway & Kneller (2007) and Wagner (2005) for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that w

49
Ursacki, T. & Vertinsky, I. (1992), ‘Choice of entry timing and scale by foreign banks in Japan and Korea’,Journal of Banking & Finance16(2), 405–421.
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  1. In-text reference with the coordinate start=6293
    Prefix
    against this claim. 6Hitt et al. (1997) use averages of the data over 1998–1990 to smooth annual fluctuations in observed variables; see p. 778. 7Researchers have studied the effects of international diversifications on stock market valuation of firms: Dos Santos et al. (2008) find that a significant valuation discount applies to product diversification but not to international diversification.
    Exact
    Ursacki & Vertinsky (1992)
    Suffix
    suggest that multinational banks may benefit from broadening the geographical scope of their business. 4 new equity issuance and cash flow to control for firm heterogeneity. In examining the role of export sales diversification on R&D expenditures, we specifically consider the impact of firm-level export sales in different regions of the world.

50
Van Biesebroeck, J. (2005), ‘Exporting raises productivity in sub-Saharan African manufacturing firms’,Journal of International Economics67(2), 373–391.
Total in-text references: 1
  1. In-text reference with the coordinate start=15297
    Prefix
    In any sample of firm-level data, it is likely that a number of firms will report zero values 13It is equally possible as Kotabe (1990) suggests that diversified firms have easier access to financial resources allowing them to smooth their R&D expenditures. 14Also see Van
    Exact
    Biesebroeck (2005) and
    Suffix
    De Loecker (2007) who find that productivity increases after firms enter the export market in Ivory Coast and Slovenia, respectively. 8 for this category of expenditure in a given year. However, in a standard regression context, the empirical distribution of the series due to the prevalence of zero values is neglected.

51
Wagner, J. (2005), Exports and productivity: A survey of the evidence from firm level data, Technical Report
Total in-text references: 1
  1. In-text reference with the coordinate start=13133
    Prefix
    Girma et al. (2008) investigate 10See along these lines Acs & Audretsch (1988), Cohen & Levinthal (1989), Cohen & Levinthal (1990), Teece & Pisano (1998), Mairesse & Mohnen (2005). 11The empirical literature cited above base their investigation on analytical models such as those developed by Posner (1961), Krugman (1979), Dollar (1986), Greenhalgh et al. (1994), Grossman & Helpman (1995). 12See
    Exact
    Greenaway & Kneller (2007) and Wagner (2005)
    Suffix
    for a survey of the productivity and exports literature. 7 the bidirectional relationship between R&D and export activity and finds that while previous exporting experience enhances the innovative capability of Irish firms, this is not true for the British firms in their sample.

52
Wooldridge, J. M. (2005), ‘Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity’,Journal of Applied Econometrics20(1), 39–54. 27
Total in-text references: 1
  1. In-text reference with the coordinate start=33644
    Prefix
    of the lagged dependent variable is positive and significant, suggesting that those firms that are involved in R&D activities in the previous period tend to continue their R&D programme in subsequent periods. However, the extent of persistence does not seem to be high, as the coefficient is on the order of 26We have also experimented by estimating the dynamic specification by employing the
    Exact
    Wooldridge (2005)
    Suffix
    approach. Unfortunately, in most cases we encountered convergence problems. As a consequence we proceeded with standard instrumental variable Tobit results. 17 0.44–0.45. When we focus on the coefficient of the diversification index, regardless of the measure used, we find that it has a positive sign for both panel and industry based cash flow deviations.