Industries at the World Technology Frontier: Measuring R&D Efficiency in a Non-Parametric DEA Framework
This paper identifies the leading country-industry combinations that define the world technology frontier in manufacturing. Using a unique industry dataset compiled from EU KLEMS and PATSTAT, it explores which countries and industries reveal the most efficient innovation processes. We combine a traditional nonparametric frontier approach with super-efficiency and tests for return to scale properties using bootstrap procedures to derive consistent and robust efficiency estimates. Our analysis of 17 OECD countries and 13 industries between 2000 and 2004 shows that Germany, the United States, and Denmark have the highest R&D efficiency on average in total manufacturing. However, sector-specific efficiency scores reveal substantial variation across countries. The principal industries determining the technology frontier are electrical and optical equipment, machinery, and chemical and mineral products. Our results suggest that in case of limited resources, priority should be given to the industries that promise the largest output for the available amount of investment. Instead of generally increasing the R&D-to-GDP ratio--as suggested in the Lisbon Agenda--policymakers might target future R&D efforts to those industries that are economically important and reveal excellent performance.
|Date of creation:||Sep 2011|
|Date of revision:|
|Contact details of provider:|| Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.|
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
|Order Information:|| Email: |
When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:8579. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.