Productivity growth, R&D and the rôle of international collaborative agreements: some évidence for Belgian manufacturing companies

Using Belgian firm level data on R&D and productivity, this paper provides further evidence on the important role of knowledge in explaining performance at the firm level, by augmenting the classical productivity growth approach not only with own R&D expenditures, but also with R&D cooperation. Taking the view that co-operation in R&D gives access to external know-how, the paper provides a new view on the mechanisms through which R&D spillovers may impact firm's output growth. Given the small open character of the Belgian economy, we focus especially on international technology diffusion and the role of cooperation with partners abroad. Beyond own R&D, the analysis shows support for international R&D cooperation to significantly improve firm productivity growth and more in particular, international cooperation with customers, suppliers or other companies, which reflects more applied international R&D co-operative activities. We further explored the role of international co-operative agreements, and more particularly whether it is used as a mechanism to access externally available know- how. Our proxies for available external know-how which (foreign) cooperation would give access to, did not provide conclusive evidence on R&D cooperation as a channel of transfer for knowledge spillovers. Overall, international R&D co-operation significantly increases a firm's output growth. However, the exact mechanisms how this cooperation enhances firm performance need further investigation.