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Upstream product market regulations, ICT, R&D and productivity

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  • Cette, G.
  • Lopez, J.
  • Mairesse,J.

Abstract

Our study aims at assessing the actual importance of the two main channels usually contemplated in the literature through which upstream sector anticompetitive regulations may impact productivity growth: business investments in R&D and in ICT. We thus precisely try to estimate what are the specific impacts of these two channels and their shares in total impact as against alternative channels of investments in other forms of intangible capital such as improvements in skills, management and organization. For this, we specify an extended production function relating productivity explicitly to R&D and ICT capital as well as to upstream regulations, and two factor demand functions relating R&D and ICT capital to upstream regulations. These relations are estimated on a panel of 14 OECD countries and 13 industries over the period 1987-2007. Our estimates confirm the results of previous similar studies finding that the impact of upstream regulations on total factor productivity can be sizeable, and they provide evidence that a good part of the total impact, though not a predominant one, goes through both investments in ICT and R&D, and particularly the latter.

Suggested Citation

  • Cette, G. & Lopez, J. & Mairesse,J., 2013. "Upstream product market regulations, ICT, R&D and productivity," Working papers 441, Banque de France.
  • Handle: RePEc:bfr:banfra:441
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    Cited by:

    1. Balázs Égert, 2016. "Regulation, Institutions, and Productivity: New Macroeconomic Evidence from OECD Countries," American Economic Review, American Economic Association, vol. 106(5), pages 109-113, May.
    2. Cette, Gilbert & Fernald, John & Mojon, Benoît, 2016. "The pre-Great Recession slowdown in productivity," European Economic Review, Elsevier, vol. 88(C), pages 3-20.
    3. Gilbert Cette & Jimmy Lopez & Jacques Mairesse, 2016. "Market Regulations, Prices, and Productivity," American Economic Review, American Economic Association, vol. 106(5), pages 104-108, May.
    4. Balázs Égert & Peter Gal, 2017. "The quantification of structural reforms in OECD countries: A new framework," OECD Journal: Economic Studies, OECD Publishing, vol. 2016(1), pages 91-108.
    5. Gilbert Cette & Jimmy Lopez & Jacques Mairesse, 2016. "Product and Labour Market Regulations, Production Prices, Wages and Productivity," Review of Economics and Institutions, Università di Perugia, vol. 7(2).
    6. Gilbert Cette & Christian Clerc & Lea Bresson, 2015. "Contribution of ICT Diffusion to Labour Productivity Growth: The United States, Canada, the Eurozone, and the United Kingdom, 1970-2013," International Productivity Monitor, Centre for the Study of Living Standards, vol. 28, pages 81-88, Spring.
    7. Gilbert Cette & Rémy Lecat & Carole Ly-Marin, 2017. "Long-term growth and productivity projections in advanced countries," OECD Journal: Economic Studies, OECD Publishing, vol. 2016(1), pages 71-90.
    8. Cette, G. & Lopez, J. & Mairesse, J., 2016. "What is the macroeconomic impact of ambitious structural reforms on product and labour markets?," Rue de la Banque, Banque de France, issue 27, june..
    9. Cette, G. & Clerc, C. & Bresson, L., 2016. "Contribution of information and communication technologies (ICT) to growth," Rue de la Banque, Banque de France, issue 22, April..
    10. Alberto Bucci & Vladimir Matveenko, 2017. "Horizontal differentiation and economic growth under non-CES aggregate production function," Journal of Economics, Springer, vol. 120(1), pages 1-29, January.
    11. Gilbert CETTE, 2015. "Which Role for ICTs as a Productivity Driver Over the Last Years and the Next Future?," Communications & Strategies, IDATE, Com&Strat dept., vol. 1(100), pages 65-83, 4th quart.
    12. Alberto BUCCI & Vladimir MATVEENKO, 2015. "Horizontal Differentiation and Economic Growth under Non–Homotheticity," Departmental Working Papers 2015-24, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    13. Peter Jarrett, 2012. "The Long-term Outlook for Productivity and Per Capita Income Growth for Canada: A Comparison with Selected G-20 Countries," International Productivity Monitor, Centre for the Study of Living Standards, vol. 24, pages 85-96, Fall.

    More about this item

    Keywords

    Productivity; Growth; Regulations; Competition; Catch-up; R&D; ICT;

    JEL classification:

    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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