Effect of Government R&D Programs on Innovation by Export Manufacturing Firms

The technological innovation of export firms is essential for their economic survival in the competitive environment of international manufacturing. The purpose of this paper is to analyze if government research and development (R&D) support programs enhanced the technological innovation of export manufacturing enterprises. By using Korea Innovation Survey 2014 (KIS) data, this paper empirically examines through probit analysis whether government R&D support programs in eight categories had an impact on product and process innovation performance. The results suggest that government assistance is effective for the technological innovation of export manufacturing firms. In particular, tax exemptions and marketing support enhance product innovation performance, and providing technology information and marketing support are effective for process innovation