Trade and Innovation in Services : Evidence from a Developing Economy

Studies on innovation and international trade have traditionally focused on manufacturing because neither was seen as important for services. Moreover, the few existing studies on services focus only on industrial countries, although in many developing countries services are already the largest sector in the economy and an important determinant of overall productivity growth. Using a recent firm-level innovation survey for Chile to compare the manufacturing and "tradable" services sector, this paper reveals some novel patterns. First, although services firms have on average a much lower propensity to export than manufacturing firms, services exports are less dominated by large firms and tend to be more skill intensive than manufacturing exports. Second, services firms appear to be as innovative as -- and in some cases more innovative than -- manufacturing firms, in terms of both inputs and outputs of "technological" innovative activity, although services innovations more often take a "non-technological" form. Third, services exporters (like manufacturing exporters) tend to be significantly more innovative than non-exporters, with a wider gap for innovations close to the global technological frontier. These findings suggest that the growing faith in services as a source of both trade and innovative dynamism may not be misplaced.

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Bibliographic Details
Main Authors: Mattoo, Aaditya, Iacovone, Leonardo, Zahler, Andrés
Language:English
en_US
Published: World Bank, Washington, DC 2013-06
Subjects:ADOPTION OF TECHNOLOGIES, BACK-OFFICE, BALANCE OF PAYMENTS, BUSINESS ACTIVITIES, BUSINESS PROCESSES, BUSINESS SERVICES, COLLABORATION, COMMODITIES, COMMUNICATIONS TECHNOLOGY, COMPETITIVENESS, CONFIDENCE, CONFIDENTIALITY, CUSTOMER SERVICES, CUSTOMIZATION, CUSTOMS, DATA COLLECTION, DATA LIMITATIONS, DESCRIPTION, ECONOMIC ACTIVITY, ELECTRICITY, ELECTRONIC DELIVERY, ENGINEERS, EQUIPMENT, EXCHANGE RATE, EXPORT MARKETS, FINANCIAL INVESTMENT, FINANCIAL SERVICES, FINANCIAL TRANSACTIONS, FIXED COSTS, FOREIGN INVESTMENT, FRONT-OFFICE, GOVERNMENT SERVICES, HUMAN CAPITAL, INDUSTRY PRODUCTIVITY, INITIATIVE, INNOVATION, INTERNATIONAL STANDARDS, INTERNATIONAL TRADE, INTERNATIONALIZATION, JUSTICE, LICENSE, LICENSE FEES, LICENSES, MANUFACTURING, MANUFACTURING INDUSTRIES, MARKET ECONOMIES, MARKETING, MULTINATIONAL, OPEN ACCESS, ORGANIZATIONAL INNOVATION, OUTSOURCING, PDF, PRIVATE SECTOR, PRIVATE SECTOR DEVELOPMENT, PRODUCT DESIGN, PRODUCT INNOVATION, PRODUCTIVITY, QUALITY OF INNOVATION, R&D, REGIONAL DEVELOPMENT, RENTING, RESULT, RESULTS, SERVICES INNOVATION, SERVICES INNOVATIONS, TECHNOLOGICAL DEVELOPMENTS, TECHNOLOGICAL INNOVATION, TECHNOLOGICAL INNOVATIONS, TRANSACTION, WEB, tradable services,
Online Access:http://documents.worldbank.org/curated/en/2013/06/17940726/trade-innovation-services-evidence-developing-economy-trade-innovation-services-evidence-developing-economy
https://hdl.handle.net/10986/15879
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