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Determinants of National R&D and Patenting: Application to a Small, Distant Country

Author

Listed:
  • Crawford, Ron

    (Ministry of Economic Development, New Zealand)

  • Fabling, Richard

    (Ministry of Economic Development, New Zealand)

  • Grimes , Arthur

    (Motu Economic & Public Policy Research and University of Waikato)

  • Bonner, Nick

    () (Ministry of Economic Development, New Zealand)

Abstract

We analyse the determinants of national R&D expenditure and patenting activity. In contrast to most related studies, we account for factors that impact on small, distant countries. These factors include country size, firm size, distance from major economic centres, and industrial structure. We apply the results to New Zealand, which has a low rate of privately funded R&D. We find that R&D expenditure and patenting activity are negatively affected by having a preponderance of small firms, having a heavy reliance on agriculture and also by distance of a country from major world centres. Population size is found to have no impact on either R&D or patenting. Greater R&D increases patenting, with an elasticity that indicates moderately increasing returns to scale in the relationship between R&D inputs and patent outcomes. Better intellectual property protection within a country also increases patenting activity. Once we control for these factors, New Zealand is not an outlier with respect to its R&D expenditures; it is a positive outlier with regard to patenting.

Suggested Citation

  • Crawford, Ron & Fabling, Richard & Grimes , Arthur & Bonner, Nick, 2004. "Determinants of National R&D and Patenting: Application to a Small, Distant Country," Occasional Papers 06/2, Ministry of Economic Development, New Zealand.
  • Handle: RePEc:ris:nzmedo:2006_002
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Davis, Nick, 2006. "Business R&D, Innovation and Economic Growth: An Evidence-Based Synthesis of the Policy Issues," Occasional Papers 06/8, Ministry of Economic Development, New Zealand.
    2. Procter, Roger, 2011. "Echanching Productivity: Towards an Updated Action Agenda," Occasional Papers 11/1, Ministry of Economic Development, New Zealand.
    3. Julia Hall & Grant M Scobie, 2006. "The Role of R&D in Productivity Growth: The Case of Agriculture in New Zealand: 1927 to 2001," Treasury Working Paper Series 06/01, New Zealand Treasury.

    More about this item

    Keywords

    R&D; patents; economic geography;

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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