ABSTRACT
This chapter explores the reasons for the observed differences in African firm survival in international markets. Using a unique data set that matches firm-level panel data and intersectoral input-output linkages data, the research finds that product innovation and process innovation are strong determinants of firm survival in the international market, but the effect of process innovation is greater than that of product innovation. While there is a considerable heterogeneity in the effects of product and process innovations on firm survival, there is no evidence that these variables are complementary. Furthermore, the research establishes that the speed of propagation of technological innovation has a strong effect on firm survival, especially through backward linkages.
