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Inter-Industry Strategic R&D and Supplier-Demander Relationships


  • Andrew C. Chang

    (University of California, Irvine)


This paper investigates if the R&D of an industry changes due to the R&D of an industry's suppliers and/or demanders. Using an annual industry-level panel of manufacturing R&D in the United States, I find that regressing the R&D of an industry on the lagged values of another industry's R&D suggests R&D comovement between industries with a strong supplier-demander relationship. Variance decompositions indicate that the R&D of an industry has high forecasting power over the R&D variance of another industry if the two industries share a strong supplier-demander relationship. © 2013 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Andrew C. Chang, 2013. "Inter-Industry Strategic R&D and Supplier-Demander Relationships," The Review of Economics and Statistics, MIT Press, vol. 95(2), pages 491-499, May.
  • Handle: RePEc:tpr:restat:v:95:y:2013:i:2:p:491-499

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    Cited by:

    1. Chang, Andrew C., 2014. "Tax Policy Endogeneity: Evidence from R&D Tax Credits," Finance and Economics Discussion Series 2014-101, Board of Governors of the Federal Reserve System (U.S.).
    2. Andrew C. Chang, 2016. "Banking Consolidation and Small Firm Financing for Research and Development," Finance and Economics Discussion Series 2016-029, Board of Governors of the Federal Reserve System (U.S.).

    More about this item


    inter-industry comovement; input-output tables; inter-industry linkages; research and development; R&D;

    JEL classification:

    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • L19 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Other
    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives


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