Technology, resource endowments and international competitiveness
The paper evaluates the impact of technology together with resource endowments and economies of scale on international competitiveness in OECD countries. Knowledge capital stocks are obtained by cumulating R&D expenditure. Results show that competitiveness is determined not only by the R&D activity of the representative firm, but also by the size of domestic industry as well as economy wide stocks of knowledge, indicating the presence of local externalities. Further results point to the importance of economies of scale in R&D internal to the firm and of investment for introduction of embodied technical progress. Finally, the R&D impact differs between high- and low-tech industries as well as among countries.
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