The importance of innovation for the economic performance of industrialized countries has been largely stressed recently by the theoretical and empirical literature. Moreover the intensity of knowledge externalities in generating innovation, is the key parameter in determining sustained growth in a model with endogenous technological change. This paper takles the extremely important task of identifying and estimating a "production function" of innovation for European regions using Patent and R&D data, 1977-1995. After correcting for the endogeneity bias we find that the elasticity of innovative output to R&D employment is around 1, while knowledge externalities exist, are geographically localized in an area of 200 kms and are significant. Nevertheless these externalities are not strong enough to generate sustained growth, and therefore European regions' innovative activity is better represented by a model as Jones (1995) than by one as Romer (1990). Knowledge spillovers could be due to the similar technological specialization of close regions, as we find significant spillovers also in technological space.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. 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.
Publisher Info
Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number
CESifo Working Paper No. 340.
Find related papers by JEL classification: O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General R00 - Urban, Rural, and Regional Economics - - General - - - General R10 - Urban, Rural, and Regional Economics - - General Regional Economics - - - General
References listed on IDEAS 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.:
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.)