Finally with respect to the type of products traded, our third hypothesis is that the effect of technological innovation on exports should be more robust and greater in magnitude for differentiated products than for homogeneous products. As pointed out by Cohen and Levinthal (1990), absorptive capacity is likely to play a more relevant role for complex products. Fink et al. (2005) and Tang (2006) show that technological innovation is more relevant for trade of sophisticated products, where “sophistication” is measured by product differentiation and high technology content. The results obtained in the present paper show a greater effect of technological innovation in increasing exports of differentiated and high-technology goods for intermediate levels of realised absorptive capacity. This result is consistent with the interpretation that the more experience in techniques gained by producing goods that embody a high technological content, the more the exports.8