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Determinants of long-run regional productivity: the role of R&D, human capital and public infrastructure

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Author Info
Raffaello Bronzini () (Bank of Italy)
Paolo Piselli () (Bank of Italy)

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Abstract

In this paper we estimate the long-run relationship between regional total factor productivity, R&D, human capital and public infrastructure between 1980 and 2001. We take advantage of recent developments panel cointegration techniques that control for endogeneity of regressors to estimate cointegration vectors. Empirical evidence shows that there exists a long-run equilibrium between productivity level and the three kinds of capital; among them, human capital turns out to have the strongest impact on productivity. Regional productivity is found also to be positively affected by R&D activity and public infrastructure of neighbouring regions. Finally, results of the Granger-causality tests support the hypothesis that human capital and infrastructure Granger-cause productivity in the long-run while the opposite is not true; only for R&D stock is the bi-directional causality found.

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Paper provided by Bank of Italy, Economic Research Department in its series Temi di discussione (Economic working papers) with number 597.

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Date of creation: Sep 2006
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Handle: RePEc:bdi:wptemi:td_597_06

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Related research
Keywords: Total factor productivity; research and development; public infrastructure; human capital; panel cointegration;

Find related papers by JEL classification:
O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Regional, Urban, and Rural Analyses
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data

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Cited by:
(explanations, 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.)

  1. Angelo Zago & Francesco Aiello & Camilla Mastromarco, 2008. "Be productive or face decline. On the sources and determinants of output growth in Italian manufacturing firms," Working Papers 46, Università di Verona, Dipartimento di Scienze economiche. [Downloadable!]
  2. Claudia M. Buch & Paola Monti, 2008. "Openness and Income Dispaities: Does Trade Explain the 'Mezzogiorno' Effect?," IAW Discussion Papers 41, Institut für Angewandte Wirtschaftsforschung (IAW). [Downloadable!]
  3. Richard Dion & Robert Fay, 2008. "Understanding Productivity: A Review of Recent Technical Research," Discussion Papers 08-3, Bank of Canada. [Downloadable!]
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