Impacts of National Innovation and Exports on Firm Investment: Evidence from the World Bank Enterprise Surveys (WBES)

Abstract

This study aims to assess the impact of national exports and innovation on corporate investment in countries worldwide. By using the enterprise survey sample conducted by the World Bank Enterprise Surveys (WBES) between 2019 and 2020 in 45 countries, the logistic regression results show that the export activity and the level of innovation of the country have a positive impact on investment in research and development as well as investment in purchasing new assets of enterprises. Specifically, the probability of making investment decisions by exporting enterprises is higher than enterprises exploiting the domestic market entirely. In addition, the improved innovation index increases the probability of investing.