Creating innovation and international trade: cause or consequence?

This paper focuses on the empirical evidence of the direction of causality between innovation and international trade in Russia. Granger-causality test is applied to check whether lagged import (export) causes innovation and viceversa. In order to measure innovation the indicator of patents granted is used since they contain a lot of relevant information on inventive activity. Both lagged import and export at national level cause innovation, however the former has stronger effect. Subsequently innovation starts to stimulate foreign trade only since the remote lag. It is worth noting that the impact of innovation on exports is limited, but there are no such constraints for import. Further development of the model proposed will serve to indicate the potential area of innovation policy

Keywords: innovation policy, technology market, patents, import, export


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