Effect of publicly and privately financed R&D on total factor productivity growth
AbstractThe effects of privately and publicly financed R&D on total factor productivity growth are examined. Total factor productivity (TFP) is decomposed into markup, exogenous demand, factor price, and publicly and privately financed R&D effects at the industry level. The constructed dataset consists of 11 Finnish manufacturing industries in 1975–1993. The results suggest that both privately and publicly financed R&D has a considerable effect on the TFP rate of growth but R&D explains only part of the technical progress. On the average, total R&D accounted for about 9 percent of the TFP rate of growth in manufacturing industries while one fourth of the growth could be attributed to the residual technical change. Exogenous demand effect was the biggest component, accounting almost for one third of the TFP rate of growth.
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Bibliographic InfoArticle provided by Finnish Economic Association in its journal Finnish Economic Papers.
Volume (Year): 13 (2000)
Issue (Month): 1 (Spring)
Find related papers by JEL classification:
- L6 - Industrial Organization - - Industry Studies: Manufacturing
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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- Zvi Griliches, 1998.
"Returns to Research and Development Expenditures in the Private Sector,"
in: R&D and Productivity: The Econometric Evidence, pages 49-81
National Bureau of Economic Research, Inc.
- Zvi Griliches, 1980. "Returns to Research and Development Expenditures in the Private Sector," NBER Chapters, in: New Developments in Productivity Measurement, pages 419-462 National Bureau of Economic Research, Inc.
- M. Ishaq Nadiri & Theofanis P. Mamuneas, 1994. "Infrastructure and Public R&D Investments, and the Growth of Factor Productivity in US Manufacturing Industries," NBER Working Papers 4845, National Bureau of Economic Research, Inc.
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