International Trade and Innovation
Publication information:
Akcigit, Ufuk, and Marc J. Melitz. 2022. “International Trade and Innovation”. In Handbook of International Economics, 5:377-404. Elsevier.
Abstract
We provide a review of the recent literature – both theoretical and empirical – analyzing
the multi-dimensional connections between globalization and innovation. We
develop a model that features many of those mechanisms that connect trade and innovation.
It features the joint selection of firms into innovation and international market
participation (in our model, we restrict that participation to exports). Our model also
highlights how exposure to international markets affects the incentives for innovation.
the multi-dimensional connections between globalization and innovation. We
develop a model that features many of those mechanisms that connect trade and innovation.
It features the joint selection of firms into innovation and international market
participation (in our model, we restrict that participation to exports). Our model also
highlights how exposure to international markets affects the incentives for innovation.