Innovation and Export-Productivity Link in Developing Economies: Evidence from Nigerian Firms

Using Nigeria enterprise survey data in 2007 for 1.891 firms; this study examined (i) productivity differential between exporting and non-exporting firms (ii) productivity differential between innovating and non-innovating firms and (iii) the link between productivity and exporting, as well as the role of innovation in productivity-exporting link. Both parametric and lion-parametric methods were employed in this study. Findings indicated that there is no significant difference between the productivity of exporting and non-exporting firms, while there is significant difference between productivity of innovating and non-innovating firms. The self selection and learning-by-exporting hypotheses were rejected and thus, there is no significant link between productivity and exporting. Further, innovations forms (product and process) did not have significant moderating role in productivity-exporting link. However. results show that access to a line of credit or loan from a financial institution has significant influence on firm innovation, exporting and productivity. The results further confirm that the manager experience playa key role in the productivity of non-innovating enterprise firms. Some policy lessons were drawn from the various findings of this study.