How should be the levels of public and private R&D investments to trigger modern productivity growth? Empirical evidence and lessons learned for Italian economy
AbstractGovernments in modern economies devote much policy attention to enhancing productivity and continue to emphasize its drivers such as investment in R&D. This paper analyzes the relationship between productivity growth and levels of public and private R&D expenditures. The economic analysis shows that the magnitude of R&D expenditure by business enterprise equal to 1.58% (% of GDP) and R&D expenditure of government and higher education of 1.06 (% of GDP) maximize the long-run impact on productivity growth. These optimal rates are the key to sustain productivity and technology improvements that are more and more necessary to modern economic growth.
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Bibliographic InfoPaper provided by Institute for Economic Research on Firms and Growth - Moncalieri (TO) in its series CERIS Working Paper with number 200805.
Length: 27 pages
Date of creation: Dec 2008
Date of revision:
R&D investment; Productivity growth; Optimization;
Find related papers by JEL classification:
- E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
- H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
- O57 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-02-22 (All new papers)
- NEP-EFF-2009-02-22 (Efficiency & Productivity)
- NEP-INO-2009-02-22 (Innovation)
- NEP-MAC-2009-02-22 (Macroeconomics)
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