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Study: Innovation and export-market participation in Canadian manufacturing

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Released: 2016-11-28

Canadian firms that entered export markets in the first decade of the 2000s were found to be not only larger and more productive, but also more likely to have invested in research and development (R&D).

A new study released today asks whether R&D drives the level of competitiveness required to successfully enter export markets and whether, in turn, participation in export markets increases R&D expenditures. It uses data from the Annual Survey of Manufacturers and the Annual Survey of Research and Development in Canadian Industry.

Both extramural R&D expenditures (purchased from domestic and foreign suppliers) and intramural R&D expenditures (performed in-house) increased the ability of firms to penetrate export markets. A firm reporting R&D in the Annual Survey of Manufacturers had a likelihood of exporting that was 5 percentage points higher than that of a firm without R&D.

Exporters were also more likely to start investing in R&D. Upon entry into export markets, manufacturing firms were 1 to 2 percentage points more likely to contract out the scientific-type of R&D (R&D directed towards path-breaking new products and processes), 7 percentage points more likely to purchase the developmental-type of R&D (R&D directed towards making more marginal improvements) compared with non-exporters, and 4 percentage points more likely to perform the scientific-type of R&D in-house.

Firms that began exporting also increased the intensity of extramural R&D expenditures in the year they began exporting.


The research paper "Innovation and Export-market Participation in Canadian Manufacturing," part of the Analytical Studies Branch Research Paper Series (Catalogue number11F0019M), is now available.

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To enquire about the concepts, methods or data quality of this release, contact Beiling Yan (613-863-9796;, Economic Analysis Division.

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