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Determinants of long-run regional productivity: the role of R&D, human capital and public infrastructure

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  • Raffaello Bronzini

    ()

    (Bank of Italy)

  • Paolo Piselli

    ()

    (Bank of Italy)

Abstract

In this paper we estimate the long-run relationship between regional total factor productivity, R&D, human capital and public infrastructure between 1980 and 2001. We take advantage of recent developments panel cointegration techniques that control for endogeneity of regressors to estimate cointegration vectors. Empirical evidence shows that there exists a long-run equilibrium between productivity level and the three kinds of capital; among them, human capital turns out to have the strongest impact on productivity. Regional productivity is found also to be positively affected by R&D activity and public infrastructure of neighbouring regions. Finally, results of the Granger-causality tests support the hypothesis that human capital and infrastructure Granger-cause productivity in the long-run while the opposite is not true; only for R&D stock is the bi-directional causality found.

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Paper provided by Bank of Italy, Economic Research and International Relations Area in its series Temi di discussione (Economic working papers) with number 597.

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Date of creation: Sep 2006
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Handle: RePEc:bdi:wptemi:td_597_06
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Keywords: Total factor productivity; research and development; public infrastructure; human capital; panel cointegration;

Find related papers by JEL classification:

  • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
  • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
  • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
  • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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Cited by:

  1. Richard Dion & Robert Fay, 2008. "Understanding Productivity: A Review of Recent Technical Research," Discussion Papers 08-3, Bank of Canada.
  2. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2009. "Dynamic macroeconomic effects of public capital: evidence from regional Italian data," Temi di discussione (Economic working papers) 733, Bank of Italy, Economic Research and International Relations Area.
  3. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2012. "The Macroeconomic Impact of Infrastructures: A Literature Review and Empirical Analysis on the Case of Italy," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
  4. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2012. "Network effects of public transport infrastructure: Evidence on Italian regions," Papers in Regional Science, Wiley Blackwell, vol. 91(3), pages 515-541, 08.
  5. Pompei, Fabrizio, 2013. "Efficiency And Productivity Growth Across The Italian Regions: The Regional Divide Revisited," MPRA Paper 52052, University Library of Munich, Germany.
  6. Claudia Buch & Paola Monti, 2010. "Openness and income disparities: does trade explain the “Mezzogiorno effect”?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(4), pages 667-688, January.
  7. Salvatore Amico Roxas & Antonio Cristofaro & Giuseppe Piroli, 2012. "Public Capital in the Private Sector of Italian Economy," EERI Research Paper Series EERI_RP_2012_19, Economics and Econometrics Research Institute (EERI), Brussels.
  8. Francesco Aiello & Camilla Mastromarco & Angelo Zago, 2008. "Be productive or face decline. On the sources and determinants of output growth in Italian manufacturing firms," Working Papers 46/2008, University of Verona, Department of Economics.
  9. Fabrizio Balassone & Maura Francese & Angelo Pace, 2011. "Public Debt and Economic Growth in Italy," Quaderni di storia economica (Economic History Working Papers) 11, Bank of Italy, Economic Research and International Relations Area.

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