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Plant Productivity Dynamics and Private and Public R&D Spillovers: Technological, Geographic and Relational Proximity

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  • Belderbos, Rene
  • Ikeuchi, Kenta
  • Fukao, Kyoji
  • Kim, Young Gak
  • Kwon, Hyeog Ug

Abstract

We examine the effects of R&D spillovers on total factor productivity in a large panel of Japanese manufacturing plants matched with R&D survey data (1987-2007). We simultaneously examine the role of public (university and research institutions) and private (firm) R&D spillovers, and examine the differential effects due to technological, geographic and relational (buyer-supplier) proximity. Estimating dynamic long difference models and allowing for gradual convergence in TFP and geographic decay in spillover effects, we find positive effects of technologically proximate private R&D stocks, which decay in distance and become negligible at around 500 kilometres. In addition to knowledge spillovers from technologically proximate R&D stocks, ‘relational’ spillovers from buyer and supplier R&D stocks exert positive effects on TFP growth that are similar in magnitude. The elasticity of TFP is highest for public R&D (corrected for industrial relevance), in particular for plants operated by R&D conducting firms. We do not find evidence of geographic decay in the impact of public and relational spillovers. Over time, declining R&D spillovers appear to be responsible for a substantial part of the decline in the rate of TFP growth. The exit of proximate plants operated by R&D intensive firms plays a notable role in this process and is an important phenomenon in major industrial agglomerations such as Tokyo, Osaka, and Kanagawa.

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  • Belderbos, Rene & Ikeuchi, Kenta & Fukao, Kyoji & Kim, Young Gak & Kwon, Hyeog Ug, 2013. "Plant Productivity Dynamics and Private and Public R&D Spillovers: Technological, Geographic and Relational Proximity," CEI Working Paper Series 2013-05, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hit:hitcei:2013-05
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    Cited by:

    1. Fukao, Kyoji, 2017. "Secular Stagnation and the Labor Market in Japan," SSPJ Discussion Paper Series DP17-2, Service Sector Productivity in Japan: Determinants and Policies, Institute of Economic Research, Hitotsubashi University.
    2. Fukao, Kyoji & 深尾, 京司, 2017. "Secular Stagnation and the Labor Market in Japan," SSPJ Discussion Paper Series DP17-002, Service Sector Productivity in Japan: Determinants and Policies, Institute of Economic Research, Hitotsubashi University.
    3. Rene Belderbos & Kyoji Fukao & Kenta Ikeuchi & Young Gak Kim & Hyeog Ug Kwon, 2015. "Buyers, suppliers, and R&D spillovers," Working Papers of Department of Management, Strategy and Innovation, Leuven 502593, KU Leuven, Faculty of Economics and Business (FEB), Department of Management, Strategy and Innovation, Leuven.
    4. Kyoji Fukao & YoungGak Kim & HyeogUg Kwon, 2021. "The Causes of Japan’s Economic Slowdown: An Analysis Based on the Japan Industrial Productivity Database," International Productivity Monitor, Centre for the Study of Living Standards, vol. 40, pages 56-88, Spring.
    5. Kenta Ikeuchi & YoungGak Kim & Hyeog Ug Kwon & Kyoji Fukao, 2022. "Productivity dynamics in Japan and the negative exit effect," Contemporary Economic Policy, Western Economic Association International, vol. 40(1), pages 204-217, January.

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    More about this item

    Keywords

    R&D; spillovers; plant productivity; distance;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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