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Does history matter for the relationship between R&D, Innovation and Productivity?

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  • Elena Huergo
  • Lourdes Moreno

Abstract

This paper analyzes the relationship between R&D expenditures, innovation and productivity growth, taking into account the possibility of persistence in firms’ behaviour. We study this relationship for a sample of Spanish manufacturing firms between 1990 and 2005, estimating a model with four equations: participation in technological activities, R&D intensity, the generation of innovations and the impact of these technological outputs on total factor productivity growth. Our results reflect the existence of true state dependence both in the decision of R&D investment and in the production of innovations. The omission of this persistence leads to an overestimation of the current impact of innovations on productivity growth. However, the presence of persistence in technological inputs and outputs entails current R&D activities having long–run effects on a firm’s productivity.

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Bibliographic Info

Paper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI_RP_2010_41.

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Date of creation: 21 Oct 2010
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Handle: RePEc:eei:rpaper:eeri_rp_2010_41

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Keywords: CDM model; productivity growth; persistence in R&D and innovation.;

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References

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  1. Bronwyn H. Hall & Jacques Mairesse & Benoit Mulkay, 1998. "Does cash flow cause investment and R&D: an exploration using panel data for French, Japanes and United States scientific firms," IFS Working Papers W98/11, Institute for Fiscal Studies.
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  8. Jacques Mairesse & Pierre Mohnen, 2004. "The Importance of R&D for Innovation : A Reassessment Using French Survey Data," Working Papers 2004-25, Centre de Recherche en Economie et Statistique.
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Citations

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Cited by:
  1. Wladimir Raymond & Jacques Mairesse & Pierre Mohnen & Franz Palm, 2013. "Dynamic Models of R&D, Innovation and Productivity: Panel Data Evidence for Dutch and French Manufacturing," CESifo Working Paper Series 4290, CESifo Group Munich.
  2. Huergo, Elena & Moreno, Lourdes, 2014. "National or international public funding? Subsidies or loans? Evaluating the innovation impact of R&D support programmes," MPRA Paper 54218, University Library of Munich, Germany.
  3. BENEKI, Christina & GIANNIAS, Dimitrios & MOUSTAKAS, George, 2012. "INNOVATION AND ECONOMIC PERFORMANCE: the case of Greek SMEs," Regional and Sectoral Economic Studies, Euro-American Association of Economic Development, vol. 12(1), pages 43-54.
  4. Esther Goya & Esther Vayá & Jordi Suriñach, 2012. "“Do intra- and inter-industry spillovers matter? CDM model estimates for Spain”," IREA Working Papers 201214, University of Barcelona, Research Institute of Applied Economics, revised Sep 2012.
  5. Raymond, Wladimir & Mairesse, Jacques & Mohnen, Pierre & Palm, Franz, 2013. "Dynamic models of R&D, innovation and productivity: Panel data evidence for Dutch and French manufacturing," MERIT Working Papers 025, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  6. Ana Paula Faria & Natália Barbosa & Vasco Eiriz, 2013. "Firms’ innovation across regions: an exploratory study," NIPE Working Papers 12/2013, NIPE - Universidade do Minho.
  7. Xulia González & Daniel Miles-Touya & Consuelo Pazó, 2012. "R&D, Worker Training, and Innovation: Firm-level evidence," Working Papers 1203, Universidade de Vigo, Departamento de Economía Aplicada.

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