The Dynamics of Exporting and Innovation: Evidence from the Tunisian Manufacturing Sector

We analyse the dynamics of internationalisation and innovation decisions using firm-level data on Tunisian manufacturing firms from 2004 to 2006. We examine whether there are complementarities between exporting and innovation investments, and whether and how these complementarities affect the firm's performance. The analysis has been conducted on two clusters of firms. The first cluster distinguishes exporters from non-exporters, and the second distinguishes fully exporting firms from others. The results are consistent with complementarities between the exporting and innovation. The results also indicate that these complementarities positively affect the firm's performance for fully exporting firms.