Relationship Among R&D, Productivity, and Firm Exports: The Moderating Role of Credit Constraints

Innovative and productive firms are more likely to export and earn a great intensive margin. However, credit constraints may disconnect or distort the linkage between export determinants and export margins. In this study, we explore whether credit constraints affect the role of R&D and productivity play in export propensity (whether a firm exports or not) and export intensity (export share in total annual sales). Using data on Indian manufacturing firms, our empirical results indicate that, while limited access to finance does not affect the R&D–exports linkage, it prevents productive firms from obtaining great export intensity. We also test whether credit constraints affect the roles of other determinants in export margins.