The rate of export discoveries goes down when first movers expect fewer benefits from their inventions because of imitation threats posed by competitors, according to a new working paper by Bailey Klinger and Daniel Lederman. Indeed, if prices for exports are determined only by global demand, imitators can either drive down those prices or drive up production costs. That, the authors argue, can lower the chances of product diversification in the export market within a particular country or industry. But that market failure might be partly compensated when export discoveries in one industry lead to findings in another. Because export diversification and new export discoveries are linked to economic growth, the authors recommend that governments not use entry barriers to protect innovators from the threat of imitation. Instead, they should consider interventions that directly stimulate export discoveries.