Role of Innovation in Hi-Tech-Exports of a Nation

Tejinder Singh Sara,Faye Hall Jackson,Leo T Upchurch

doi:10.5539/ijbm.v7n7p85

Abstract

The purpose of this paper was to look at the relationship between innovative capability of a country and share ofhigh-technology products in its exports of manufactured goods. The paper discusses the role of exports in growthof some of the fast developing countries in recent years. Export market preservation and expansion ofhigh-technology products is discussed. An empirical model with high technology exports as a percentage of thetotal manufactured exports of a country as the dependant variable and seven independent variables shows thatlevel of high-technology exports of a country is significantly affected by the innovative capability of thatcountry.

Highlights

During the last three decades, the developing countries with most rapid economic growth had substantial growth in exports
We believe that innovative capability is an important determinant of a country’s ability to design, produce and export high technology products
Innovation proved to be an important determinant of the level of high technology exports of a country (p

Summary

Introduction

During the last three decades, the developing countries with most rapid economic growth had substantial growth in exports. Chow and Kellman (1993) examined reasons behind the success of the Newly Industrialized Countries (NICs) - Hong Kong, Singapore, South Korea, and Taiwan- and came to the conclusion that increased exports were the vehicle of growth of these countries. This is vividly illustrated by the success of South Korea, and Taiwan. Local communities began producing goods and services for local consumption versus relying on export markets for provision of goods and services (Bellows & Hamm, 2000) This practice by itself added little benefit to the local community as seen in small increases in endogenous purchases that in limited fashion increased supporting income multipliers (Cooke & Watson, 2011). The main vehicle of growth for these regional areas has been attributed to increases in exports along with increases in its dual constituent, import substitution (Cooke & Watson, 2011)

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