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Productivity Gains from R&D Investment: Are High-Tech Sectors Still Ahead?

  • Ortega-Argilés, Raquel

    ()

    (IN+ Center for Innovation)

  • Piva, Mariacristina

    ()

    (Università Cattolica del Sacro Cuore)

  • Vivarelli, Marco

    ()

    (Università Cattolica del Sacro Cuore)

The purpose of this study is to investigate the relationship between a firm's R&D expenditures considered as an investment in knowledge, and its productivity, looking at sectoral peculiarities which may emerge; to this end, we use a large unique longitudinal database consisting of 1,809 US and European manufacturing and service firms over the period 1990-2008, for a total of 16,079 observations. Our main findings can be summarised as follows: knowledge stock has a significant positive impact on a firm's productivity, with an overall elasticity of about 0.10; this general result is largely consistent with findings presented in previous literature in terms of the sign, the significance and the estimated magnitude of the relevant coefficient. More interestingly, the coefficient turns out to be significantly larger in the service and high-tech sectors than in the non-high-tech manufacturing sectors. These outcomes suggest that firms in high-tech sectors are still ahead in terms of the impact on productivity of their R&D investments; moreover, a shift in favour of the service sectors seems to emerge.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5975.

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Length: 24 pages
Date of creation: Sep 2011
Date of revision:
Publication status: published in: Economics of Innovation and New Technology, 2015, 24(3), 204-222
Handle: RePEc:iza:izadps:dp5975
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  1. Raquel Ortega-Argilés & Mariacristina Piva & Lesley Potters & Marco Vivarelli, 2010. "Is Corporate R&D Investment In High-Tech Sectors More Effective?," Contemporary Economic Policy, Western Economic Association International, vol. 28(3), pages 353-365, 07.
  2. Hans Loof & Almas Heshmati, 2006. "On the relationship between innovation and performance: A sensitivity analysis," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(4-5), pages 317-344.
  3. Conte, Andrea & Vivarelli, Marco, 2005. "One or Many Knowledge Production Functions? Mapping Innovative Activity Using Microdata," IZA Discussion Papers 1878, Institute for the Study of Labor (IZA).
  4. Kuen-Hung Tsai & Jiann-Chyuan Wang, 2004. "R&D Productivity and the Spillover Effects of High-tech Industry on the Traditional Manufacturing Sector: The Case of Taiwan," The World Economy, Wiley Blackwell, vol. 27(10), pages 1555-1570, November.
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  8. Aghion, Philippe & Howitt, Peter, 1996. "The Observational Implications of Schumpeterian Growth Theory," Empirical Economics, Springer, vol. 21(1), pages 13-25.
  9. Jacques Mairesse & Pierre Mohnen, 2001. "To Be or Not To Be Innovative: An Exercise in Measurement," NBER Working Papers 8644, National Bureau of Economic Research, Inc.
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  11. Bronwyn H. Hall & Jacques Mairesse, 1992. "Exploring the Relationship Between R&D and Productivity in French Manufacturing Firms," NBER Working Papers 3956, National Bureau of Economic Research, Inc.
  12. Frank R. Lichtenberg & Donald Siegel, 1989. "The Impact of R&D Investment On Productivity - New Evidence Using Linked R&D-LRD Data," NBER Working Papers 2901, National Bureau of Economic Research, Inc.
  13. Philippe Cuneo & Jacques Mairesse, 1984. "Productivity and R&D at the Firm Level in French Manufacturing," NBER Chapters, in: R&D, Patents, and Productivity, pages 375-392 National Bureau of Economic Research, Inc.
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  15. Crepon, B. & Duguet, E. & Mairesse, J., 1998. "Research Investment, Innovation and Productivity: An Econometric Analysis at the Firm Level," Papiers d'Economie Mathématique et Applications 98.15, Université Panthéon-Sorbonne (Paris 1).
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  22. Peters, Bettina & Lööf, Hans & Janz, Norbert, 2003. "Firm Level Innovation and Productivity: Is there a Common Story Across Countries?," ZEW Discussion Papers 03-26, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  23. Agusti Segarra-Blasco, 2010. "Innovation and productivity in manufacturing and service firms in Catalonia: a regional approach," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 19(3), pages 233-258.
  24. Winter, Sidney G., 1984. "Schumpeterian competition in alternative technological regimes," Journal of Economic Behavior & Organization, Elsevier, vol. 5(3-4), pages 287-320.
  25. Thomas Hatzichronoglou, 1997. "Revision of the High-Technology Sector and Product Classification," OECD Science, Technology and Industry Working Papers 1997/2, OECD Publishing.
  26. Bogliacino, Francesco & Pianta, Mario, 2011. "Engines of growth. Innovation and productivity in industry groups," Structural Change and Economic Dynamics, Elsevier, vol. 22(1), pages 41-53, February.
  27. Agustí Segarra & Mercedes Teruel, 2011. "Productivity and R&D sources: evidence for Catalan firms," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 20(8), pages 727-748, September.
  28. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
  29. Dosi, Giovanni, 1997. "Opportunities, Incentives and the Collective Patterns of Technological Change," Economic Journal, Royal Economic Society, vol. 107(444), pages 1530-47, September.
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