Innovation and Export Portfolios

29 Pages Posted: 20 Apr 2016

See all articles by Bailey Klinger

Bailey Klinger

Center for International Development

Daniel Lederman

World Bank - Latin America and Caribbean Region

Date Written: August 1, 2006


This paper examines the link between sectoral concentration and overall performance in the search for on-the-frontier innovations, inside-the-frontier innovations, and export booms. It extends the literature by increasing country coverage and the types of search processes considered, and by focusing on the links with overall performance in these search processes. After controlling for the necessary relationships as well as fixed effects at the country/commodity group level, the paper finds a clear negative relationship between the concentration of innovation portfolios and performance: countries that are the most successful in these search processes have their successes spread across a broader range of industries than those with poorer performance. Furthermore, the search for export booms exhibits the least amount of sectoral concentration and path-dependence. These findings suggest that public support for these processes need not be focused in a narrow range of sectors, and modeling of these processes in theoretical work, particularly in the search for export booms, should be of a stochastic flavor.

Suggested Citation

Klinger, Bailey and Lederman, Daniel, Innovation and Export Portfolios (August 1, 2006). World Bank Policy Research Working Paper No. 3983, Available at SSRN:

Bailey Klinger (Contact Author)

Center for International Development ( email )

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Cambridge, MA 02138
United States
617-495-1717 (Phone)
617-496-8753 (Fax)


Daniel Lederman

World Bank - Latin America and Caribbean Region ( email )

1818 H Street NW
Washington, DC 20433
United States


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