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On `indirect' trade-related R&D spillovers

  • Lumenga-Neso, Olivier
  • Olarreaga, Marcelo
  • Schiff, Maurice

An influential literature argues that trade promotes knowledge flows and technology transmission between trading partners. This literature focuses on ‘direct’ R&D spillovers which are related to the levels of R&D produced by the trading partners. In this paper we argue that ‘indirect’ trade-related R&D spillovers also take place between countries, even if they do not trade with each other. These ‘indirect’ spillovers are associated with available rather than with produced levels of R&D. Our empirical results suggest that these ‘indirect’ trade-related spillovers are at least as important as the ‘direct’ ones, and strengthen the view that trade does matter for the international transmission of R&D. They also suggest that, due to the existence of these ‘indirect’ effects, bilateral trade patterns are relatively less important as determinants of the level of foreign R&D spillovers acquired through trade.

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Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 49 (2005)
Issue (Month): 7 (October)
Pages: 1785-1798

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Handle: RePEc:eee:eecrev:v:49:y:2005:i:7:p:1785-1798
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  3. Keller, Wolfgang, 1998. "Are international R&D spillovers trade-related?: Analyzing spillovers among randomly matched trade partners," European Economic Review, Elsevier, vol. 42(8), pages 1469-1481, September.
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  13. Elhanan Helpman & David T. Coe, 1993. "International RandD Spillovers," IMF Working Papers 93/84, International Monetary Fund.
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  16. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
  17. David T. Coe & Alexander W. Hoffmaister, 1999. "Are there International RandD Spillovers Among Randomly Matched Trade Partners? A Response to Keller," IMF Working Papers 99/18, International Monetary Fund.
  18. Branstetter, Lee G., 2001. "Are knowledge spillovers international or intranational in scope?: Microeconometric evidence from the U.S. and Japan," Journal of International Economics, Elsevier, vol. 53(1), pages 53-79, February.
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