Strategic interactions in public R&D across EU-15 countries: A spatial econometric analysis
AbstractThe aim of this paper is to test the presence of strategic interactions in government spending on Research and Development (R&D) among EU-15 countries. We add to the literature on public choice strategic interactions in general, and to work on R&D spending in particular. We take account of traditional and some overlooked factors related to countries' public R&D spending, including (i) the international context -- i.e. Lisbon strategy; (ii) country characteristics - the National System of Innovation, and more specifically national similarities in relation to (a) trade and economic size and (b) sectoral specialization. Sectoral specialization is likely to affect government spending, depending on the mechanisms of complementarity or substitution between public and private R&D. Using a spatial dynamic panel model in which spatial matrices are specified both in terms of traditional Euclidean distance, and sectoral specialization proximity, we confirm the existence of strategic interactions on R&D spending among European countries with similar economic size, international trade and sectoral structure. Unlike the results emerging from the literature on strategic interactions in public choice, geographic proximity seems not to affect interactions related to public spending on R&D.
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Bibliographic InfoPaper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2012/14.
Date of creation: 27 Aug 2012
Date of revision:
Public spending strategic interactions; Public R&D expenditures; National Systems of Innovation; Complementarity public and private R&D; Spatial interactions; EU countries; spatial dynamic panel data;
Other versions of this item:
- Hakim Hammadou & Sonia Paty & Maria Savona, 2012. "Strategic interactions in public R&D across EU-15 countries : A spatial econometric analysis," Working Papers halshs-00727362, HAL.
- Hakim Hammadou & Sonia Paty & Maria Savona, 2012. "Strategic interactions in public R&D across EU-15 countries : A spatial econometric analysis," Working Papers 1223, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
- H5 - Public Economics - - National Government Expenditures and Related Policies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-09-09 (All new papers)
- NEP-CSE-2012-09-09 (Economics of Strategic Management)
- NEP-EUR-2012-09-09 (Microeconomic European Issues)
- NEP-GEO-2012-09-09 (Economic Geography)
- NEP-INO-2012-09-09 (Innovation)
- NEP-KNM-2012-09-09 (Knowledge Management & Knowledge Economy)
- NEP-PBE-2012-09-09 (Public Economics)
- NEP-SBM-2012-09-09 (Small Business Management)
- NEP-URE-2012-09-09 (Urban & Real Estate Economics)
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