Impact of R&D Investment on Economic Growth of the Czech Republic - A Recursively Dynamic CGE Approach
AbstractThe paper investigates how results obtained with standard CGE models can be improved by incorporating the effects of R&D activity in a recursively-dynamic CGE model built for the economy of the Czech Republic. The main objective of the paper is to quantify the impact of R&D activity on the long-term economic growth of the Czech Republic within the recursively dynamic CGE framework. The effect of R&D investment is modelled via the accumulation of knowledge that is treated as a specific production factor. The main findings show that knowledge accumulation can contribute to higher economic growth, but the impact of the dynamisation in the CGE model is very low. However, in terms of structural changes in the economy, the omission of knowledge capitalization might underestimate the tertiary sector in the longer run. The paper also investigates the efficiency of R&D investment and concludes that in the longer run, investment in capital goods is more efficient in achieving higher economic growth. In the concluding chapter, related factors that may improve the impact of knowledge in the CGE model are discussed.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by University of Economics, Prague in its journal Prague Economic Papers.
Volume (Year): 2012 (2012)
Issue (Month): 4 ()
Postal: Editorial office Prague Economic Papers, University of Economics, nám. W. Churchilla 4, 130 67 Praha 3, Czech Republic
Find related papers by JEL classification:
- C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
- D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
- E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Capital; Investment; Capacity
- O3 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gillingham, Kenneth T. & Newell, Richard G. & Pizer, William A., 2007.
"Modeling Endogenous Technological Change for Climate Policy Analysis,"
dp-07-14, Resources For the Future.
- Gillingham, Kenneth & Newell, Richard G. & Pizer, William A., 2008. "Modeling endogenous technological change for climate policy analysis," Energy Economics, Elsevier, vol. 30(6), pages 2734-2753, November.
- Siddiqi, Yusuf & Salem, Meir, 2006. "A Proposal for Treating Research and Development As Capital Expenditures in the Canadian SNA," Economic Analysis (EA) Research Paper Series 2006040e, Statistics Canada, Analytical Studies Branch.
- Wang, Ke & Wang, Can & Chen, Jining, 2009. "Analysis of the economic impact of different Chinese climate policy options based on a CGE model incorporating endogenous technological change," Energy Policy, Elsevier, vol. 37(8), pages 2930-2940, August.
- Arjan Lejour & Hugo Rojas-Romagosa, 2008. "International spillovers of domestic reforms: the joint application of the Lisbon Strategy in the EU," CPB Discussion Paper 105, CPB Netherlands Bureau for Economic Policy Analysis.
- Romer, Paul M, 1990.
"Endogenous Technological Change,"
Journal of Political Economy,
University of Chicago Press, vol. 98(5), pages S71-102, October.
- Diao, Xinshen & Roe, Terry & Yeldan, Erinc, 1999.
"Strategic policies and growth: an applied model of R&D-driven endogenous growth,"
Journal of Development Economics,
Elsevier, vol. 60(2), pages 343-380, December.
- Xinshen Diao & Terry Roe & Erinç Yeldan, 1998. "Strategic Policies and Growth : An Applied Model of R&D-Driven Endogenous Growth," Departmental Working Papers 981, Bilkent University, Department of Economics.
- Michal Kejak & Stephan Seiter & David Vavra, 2004.
"Accession Trajectories and Convergence: Endogenous Growth Perspective,"
CERGE-EI Working Papers
wp219, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
- Kejak, Michal & Seiter, Stephan & Vavra, David, 2004. "Accession trajectories and convergence: endogenous growth perspective," Structural Change and Economic Dynamics, Elsevier, vol. 15(1), pages 13-46, March.
- Kamil Dybczak & David Vonka & Nico van der Windt, 2008. "The Effect of Oil Price Shocks on the Czech Economy," Working Papers 2008/5, Czech National Bank, Research Department.
- Michal Kejak & David Vavra, 2004. "Factor Accumulation Story: Any Unfinished Business?," CERGE-EI Working Papers wp220, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
- G. Garau & P. Lecca, 2008. "Impact Analysis of Regional Knowledge Subsidy: a CGE Approach," Working Paper CRENoS 200811, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Fernando Galindo-Rueda, 2007. "Developing an R&D satellite account for the UK: a preliminary analysis," Economic and Labour Market Review, Palgrave Macmillan, vol. 1(12), pages 18-29, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Vaclav Subrta).
If references are entirely missing, you can add them using this form.