IDEAS home Printed from https://ideas.repec.org/a/kap/jproda/v47y2017i3d10.1007_s11123-017-0503-9.html
   My bibliography  Save this article

The contribution of research and innovation to productivity

Author

Listed:
  • Amani Elnasri

    (The Australian Bureau of Statistics)

  • Kevin J. Fox

    (UNSW)

Abstract

This paper examines the impact of investment in research and innovation on Australian market sector productivity. While previous studies have largely focused on a narrow class of private sector intangible assets as a source of productivity gains, this paper shows that there is a broad range of other business sector intangible assets that can significantly affect productivity. Moreover, the paper pays special attention to the role played by public funding for research and innovation. The empirical results suggest that there are significant spillovers to productivity from public sector R&D spending on research agencies and higher education. No evidence is found for productivity spillovers from indirect public funding for the business enterprise sector, civil sector or defence R&D. These findings have implications for government innovation policy as they provide insights into possible productivity gains from government funding reallocations.

Suggested Citation

  • Amani Elnasri & Kevin J. Fox, 2017. "The contribution of research and innovation to productivity," Journal of Productivity Analysis, Springer, vol. 47(3), pages 291-308, June.
    • Handle: RePEc:kap:jproda:v:47:y:2017:i:3:d:10.1007_s11123-017-0503-9
    DOI: 10.1007/s11123-017-0503-9
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11123-017-0503-9
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11123-017-0503-9?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mauro Giorgio Marrano & Jonathan Haskel, 2006. "How Much Does the UK Invest in Intangible Assets?," Working Papers 578, Queen Mary University of London, School of Economics and Finance.
    2. Carol Corrado & Charles Hulten & Daniel Sichel, 2009. "Intangible Capital And U.S. Economic Growth," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 661-685, September.
    3. Kyoji Fukao & Tsutomu Miyagawa & Kentaro Mukai & Yukio Shinoda & Konomi Tonogi, 2009. "Intangible Investment In Japan: Measurement And Contribution To Economic Growth," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 717-736, September.
    4. repec:bla:ecorec:v:70:y:1994:i:209:p:121-32 is not listed on IDEAS
    5. Vernon Topp & Leo Soames & Dean Parham & Harry Bloch, 2008. "Productivity in the Mining Industry: Measurement and Interpretation," Staff Working Papers 0807, Productivity Commission, Government of Australia.
    6. Jack E. Triplett, 1999. "The Solow productivity paradox: what do computers do to productivity?," Canadian Journal of Economics, Canadian Economics Association, vol. 32(2), pages 309-334, April.
    7. Amani Elnasri & Kevin J. Fox, 2014. "The Contribution of Research and Innovation to Productivity and Economic Growth," Discussion Papers 2014-08, School of Economics, The University of New South Wales.
    8. Haskel, Jonathan & Wallis, Gavin, 2013. "Public support for innovation, intangible investment and productivity growth in the UK market sector," Economics Letters, Elsevier, vol. 119(2), pages 195-198.
    9. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    10. Gary Madden & Scott J. Savage, 1998. "Sources of Australian Labour Productivity Change 1950–1994," The Economic Record, The Economic Society of Australia, vol. 74(227), pages 362-372, December.
    11. Mauro Giorgio Marrano & Jonathan Haskel & Gavin Wallis, 2009. "What Happened To The Knowledge Economy? Ict, Intangible Investment, And Britain'S Productivity Record Revisited," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 686-716, September.
    12. K. J. Arrow, 1971. "The Economic Implications of Learning by Doing," Palgrave Macmillan Books, in: F. H. Hahn (ed.), Readings in the Theory of Growth, chapter 11, pages 131-149, Palgrave Macmillan.
    13. Barnes, Paula, 2010. "Investments in Intangible Assets and Australia’s Productivity Growth — Sectoral Estimates," Staff Working Papers 103, Productivity Commission, Government of Australia.
    14. Aw, Bee Yan & Chen, Xiaomin & Roberts, Mark J., 2001. "Firm-level evidence on productivity differentials and turnover in Taiwanese manufacturing," Journal of Development Economics, Elsevier, vol. 66(1), pages 51-86, October.
    15. Valentin Zelenyuk, 2014. "Testing Significance of Contributions in Growth Accounting, with Application to Testing ICT Impact on Labor Productivity of Developed Countries," International Journal of Business and Economics, School of Management Development, Feng Chia University, Taichung, Taiwan, vol. 13(2), pages 115-126, December.
    16. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    17. Erik Brynjolfsson & Lorin M. Hitt, 2000. "Beyond Computation: Information Technology, Organizational Transformation and Business Performance," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 23-48, Fall.
    18. Jalava, Jukka & Aulin-Ahmavaara, Pirkko & Alanen, Aku, 2007. "Intangible Capital in the Finnish Business Sector 1975-2005," Discussion Papers 1103, The Research Institute of the Finnish Economy.
    19. repec:bla:ecorec:v:74:y:1998:i:227:p:362-72 is not listed on IDEAS
    20. Glenn Otto & Graham M. Voss, 1994. "Public Capital and Private Sector Productivity," The Economic Record, The Economic Society of Australia, vol. 70(209), pages 121-132, June.
    21. Bolaky, Bineswaree & Freund, Caroline, 2004. "Trade, regulations, and growth," Policy Research Working Paper Series 3255, The World Bank.
    22. Baldwin, John R. & Gu, Wulong & Macdonald, Ryan, 2012. "Intangible Capital and Productivity Growth in Canada," The Canadian Productivity Review 2012029e, Statistics Canada, Economic Analysis Division.
    23. Diewert, W. Erwin & Fox, Kevin J., 2016. "Alternative User Costs, Rates of Return and TFP Growth Rates for the US Nonfinancial Corporate and Noncorporate Business Sectors: 1960-2014," Microeconomics.ca working papers erwin_diewert-2016-7, Vancouver School of Economics, revised 30 Jun 2016.
    24. Ellis Connolly & Kevin J. Fox, 2006. "The Impact of High-Tech Capital on Productivity: Evidence from Australia," Economic Inquiry, Western Economic Association International, vol. 44(1), pages 50-68, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Schubert, Torben & Jäger, Angela & Türkeli, Serdar & Visentin, Fabiana, 2020. "Addressing the productivity paradox with big data: A literature review and adaptation of the CDM econometric model," MERIT Working Papers 2020-050, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    2. Diewert, Erwin & Fox, Kevin J., 2019. "Productivity Indexes and National Statistics: Theory, Methods and Challenges," Microeconomics.ca working papers erwin_diewert-2019-8, Vancouver School of Economics, revised 25 Apr 2019.
    3. Anna Thum-Thysen & Peter Voigt & Christoph Weiss, 2021. "Reflections on Complementarities in Capital Formation and Production: Tangible and Intangible Assets across Europe," European Economy - Discussion Papers 152, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    4. Roth, Felix, 2019. "Intangible Capital and Labour Productivity Growth: A Review of the Literature," Hamburg Discussion Papers in International Economics 4, University of Hamburg, Department of Economics.
    5. Thomas H. W. Ziesemer, 2024. "Public R&D and Growth: A dynamic Panel Vector-Error-Correction Model Analysis for 14 OECD Countries," Economies, MDPI, vol. 12(8), pages 1-33, August.
    6. Nathan Chappell & Adam Jaffe, 2018. "Intangible Investment and Firm Performance," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 52(4), pages 509-559, June.
    7. Thum-Thysen, Anna & Voigt, Peter & Weiss, Christoph, 2021. "Complementarities in capital formation and production: Tangible and intangible assets across Europe," EIB Working Papers 2021/12, European Investment Bank (EIB).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amani Elnasri & Kevin J. Fox, 2014. "The Contribution of Research and Innovation to Productivity and Economic Growth," Discussion Papers 2014-08, School of Economics, The University of New South Wales.
    2. Roth, Felix, 2019. "Intangible Capital and Labour Productivity Growth: A Review of the Literature," Hamburg Discussion Papers in International Economics 4, University of Hamburg, Department of Economics.
    3. Schubert, Torben & Jäger, Angela & Türkeli, Serdar & Visentin, Fabiana, 2020. "Addressing the productivity paradox with big data: A literature review and adaptation of the CDM econometric model," MERIT Working Papers 2020-050, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    4. Carolina Hintzmann & Josep Lladós-Masllorens & Raul Ramos, 2021. "Intangible Assets and Labor Productivity Growth," Economies, MDPI, vol. 9(2), pages 1-21, May.
    5. Hyunbae Chun & M. Ishaq Nadiri, 2016. "Intangible Investment and Changing Sources of Growth in Korea," The Japanese Economic Review, Japanese Economic Association, vol. 67(1), pages 50-76, March.
    6. Li, Qing & Wu, Yanrui, 2018. "Intangible capital in Chinese regional economies: Measurement and analysis," China Economic Review, Elsevier, vol. 51(C), pages 323-341.
    7. Nonnis, Alberto & Bounfour, Ahmed & Kim, Keungoui, 2023. "Knowledge spillovers and intangible complementarities: Empirical case of European countries," Research Policy, Elsevier, vol. 52(1).
    8. Cecilia Iona Lasinio & Massimiliano Iommi & Stefano Manzocchi, 2011. "Intangible capital and Productivity Growth in European Countries," Working Papers LuissLab 1191, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    9. Berger Florian, 2012. "Measuring the Knowledge Economy – Intangible Spending and Investment in Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 232(1), pages 12-30, February.
    10. Haskel, Jonathan & Wallis, Gavin, 2013. "Public support for innovation, intangible investment and productivity growth in the UK market sector," Economics Letters, Elsevier, vol. 119(2), pages 195-198.
    11. Mariela Dal Borgo & Peter Goodridge & Jonathan Haskel & Annarosa Pesole, 2013. "Productivity and Growth in UK Industries: An Intangible Investment Approach," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 75(6), pages 806-834, December.
    12. Siedschlag, Iulia & Lawless, Martina & Di Ubaldo, Mattia, 2017. "Investment in knowledge-based capital and its contribution to productivity growth: a review of international and Irish evidence," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT336.
    13. Wen Chen, 2018. "Cross‐Country Income Differences Revisited: Accounting for the Role of Intangible Capital," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(3), pages 626-648, September.
    14. Shenglang Yang, 2016. "Intangible capital and sectoral energy intensity: Evidence from 40 economies," ANU Working Papers in Economics and Econometrics 2016-646, Australian National University, College of Business and Economics, School of Economics.
    15. Tsutomu Miyagawa & Shoichi Hisa, 2013. "Measurement of Intangible Investment by Industry and Economic Growth in Japan," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 9(2), pages 405-432, March.
    16. Rammer, Christian & Köhler, Christian, 2012. "Innovationen, Anlageinvestitionen und immaterielle Investitionen," ZEW Discussion Papers 12-085, ZEW - Leibniz Centre for European Economic Research.
    17. Felix Roth, 2022. "The Productivity Puzzle: A Critical Assessment and an Outlook on the COVID-19 Crisis," Contributions to Economics, in: Intangible Capital and Growth, chapter 0, pages 1-16, Springer.
    18. Ian Goldin & Pantelis Koutroumpis & François Lafond & Julian Winkler, 2024. "Why Is Productivity Slowing Down?," Journal of Economic Literature, American Economic Association, vol. 62(1), pages 196-268, March.
    19. Roth,Felix & Thum, Anna-Elisabeth, 2010. "Does intangible capital affect economic growth?," CEPS Papers 3667, Centre for European Policy Studies.
    20. Stefan Schweikl & Robert Obermaier, 2020. "Lessons from three decades of IT productivity research: towards a better understanding of IT-induced productivity effects," Management Review Quarterly, Springer, vol. 70(4), pages 461-507, November.

    More about this item

    Keywords

    Productivity; Innovation; Intangible assets; Public funding;
    All these keywords.

    JEL classification:

    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • H4 - Public Economics - - Publicly Provided Goods

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jproda:v:47:y:2017:i:3:d:10.1007_s11123-017-0503-9. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.