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R&D-Productivity Dynamics: Causality, Lags, and "Dry Holes"

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Abstract

We study four issues in R&D–productivity dynamics: does R&D Granger cause productivity, is there a lag between R&D and its productivity effects, does the potency of R&D vary in timing and magnitude, and what is the role of R&D spillovers and aggregate shocks. The results suggest that R&D causes productivity but not vice versa, productivity responds to changes in R&D with a considerable lag, the potency of R&D varies in timing and magnitude, and that the elasticity of productivity with respect to aggregate shocks is high, but negligible with respect to R&D spillovers.

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Bibliographic Info

Article provided by Universidad del CEMA in its journal Journal of Applied Economics.

Volume (Year): V (2002)
Issue (Month): (May)
Pages: 123-156

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Handle: RePEc:cem:jaecon:v:5:y:2002:n:1:p:123-156

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Related research

Keywords: total factor productivity; TFP; R&D; causality; lag structure;

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References

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Citations

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Cited by:
  1. Lihong Yun, 2008. "Technical Progress and Labour Demand in Swedish Manufacturing Firms," Journal of Industry, Competition and Trade, Springer, vol. 8(2), pages 147-167, June.
  2. Mika Maliranta, 2005. "R&D, International Trade and Creative Destruction—Empirical Findings from Finnish Manufacturing Industries," Journal of Industry, Competition and Trade, Springer, vol. 5(1), pages 27-58, January.
  3. Maliranta, Mika & Rouvinen, Petri, 2003. "Productivity Effects of ICT in Finnish Business," Discussion Papers 852, The Research Institute of the Finnish Economy.
  4. repec:idb:brikps:38218 is not listed on IDEAS
  5. José; Miguel Benavente H., 2004. "Technological Innovation In Chile Where We Are and What Can be Done," Working Papers Central Bank of Chile 295, Central Bank of Chile.
  6. Claudio Bravo Ortega & Álvaro García Marín, 2008. "Exploring the Relationship Between R&D and Productivity: A Country-Level Study," Working Papers Central Bank of Chile 472, Central Bank of Chile.
  7. Maliranta, Mika, . "Micro Level Dynamics of Productivity Growth. An Empirical Analysis of the Great Leap in Finnish Manufacturing Productivity in 1975-2000," ETLA A, The Research Institute of the Finnish Economy, number 38.
  8. Böckerman, Petri & Eero, Lehto & Huovari, Janne, 2008. "The return to the technological frontier: The conditional effect of plants’ R&D on their productivity in Finnish manufacturing," MPRA Paper 8715, University Library of Munich, Germany.
  9. Erdal Atukeren, 2005. "R&D Races and Spillovers between the EU and the US: Some Causal Evidence," KOF Working papers 05-105, KOF Swiss Economic Institute, ETH Zurich.
  10. Gabsi, Foued & Mhenni, Hatem & Koouba, Karim, 2010. "Determinants of Innovation in Emerging Country: an empirical study at the Tunisian firm level," MPRA Paper 46182, University Library of Munich, Germany, revised 2008.
  11. Ali-Yrkkö, Jyrki & Maliranta, Mika, 2006. "Impact of R&D on Productivity - Firm-level Evidence from Finland," Discussion Papers 1031, The Research Institute of the Finnish Economy.
  12. repec:idb:brikps:8608 is not listed on IDEAS
  13. Maliranta, Mika, 2002. "From R&D to Productivity Through Micro-Level Restructuring," Discussion Papers 795, The Research Institute of the Finnish Economy.
  14. Gabsi, Foued & Mhenni, Hatem & Koouba, Karim, 2008. "Innovation Determinants in Emerging Countries: An Empirical Study at the Tunisian Firms level," MPRA Paper 17940, University Library of Munich, Germany, revised 2008.
  15. Hulya Ulku, 2004. "RandD, innovation, and Economic Growth," IMF Working Papers 04/185, International Monetary Fund.

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