Determinants of R&D and Its Productivity: Identifying Demand and Supply Channels (First revision)
AbstractIdentifying whether an exogenous factor affects R&D from a demand side or from a supply side is an important issue. This paper, first, theoretically shows that a favorable change in either side can reduce the R&D productivity in equilibrium, so that the reduced form estimation cannot provide a clear identification. Secondly, it estimates both structural and reduced form patent production functions, based on instrumental variables approach, using a large database on Japanese firms. According to the estimation, while the initial firm size, market concentration or export orientation increases R&D, none of them significantly shifts the structural patent production function.
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Bibliographic InfoPaper provided by Institute of Innovation Research, Hitotsubashi University in its series IIR Working Paper with number 03-12.
Length: 30,  p.
Date of creation: Jun 2003
Date of revision:
R&D productivity; patent; firm size; competition;
Find related papers by JEL classification:
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- O34 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Intellectual Property Rights
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
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