This paper examines the links between international nancial integration and the level of innovation activity. If nancial globalisation boosts innovation, this helps to explain the empirical evidence that indicates that increased nancial integration conditionally raises the level of productivity and long-run living standards. Our analysis nds that, conditional on the level of development, more integrated economies do exhibit higher levels of innovation activity but that the impact di¤ers across equitytype and debt-type dimensions of international nancial integration. Moreover, the gains from equity-type integration kick in at relatively low income levels, whereas the gains from debt-type integration are only found for high-income countries. Email: email@example.com. Homepage: http://www.philiplane.org. Mailing address: Economics Department, Trinity College Dublin, Dublin 2, Ireland. Prepared for the World Banks ABCDE2009 (Korea) conference. I am grateful to my discussant Jan Svejnar, the anonymous reviewers and Richard Tol for helpful comments and Daniel Lederman for help with data. I thank Peter McQuade for excellent research assistance.