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How Robust is the R&D – Productivity relationship? Evidence from OECD Countries

  • Mosahid Khan

    ()

    (World Intellectual Property Organization, Geneva, Switzerland)

  • Kul B. Luintel

    ()

    (Cardiff Business School, Cardiff, United Kingdom)

  • Konstantinos Theodoris

    ()

    (Bank of England, London, United Kingdom)

We examine the robustness of R&D and productivity relationship in a panel of 16 OECD countries. We control for fifteen productivity determinants predicted by different theoretical models. Following the advances in non-stationary panel data econometrics, we estimate four variants of thirteen specifications. All models appear co-integrated. Results are rigorously scrutinized through extensive bootstrap simulations and sensitivity checks. R&D and human capital emerge robust in all specifications making them universal drivers of productivity across nations. Most other determinants are also significant. Productivity relationships are heterogonous across countries depending on their accumulated stocks of knowledge and human capital.

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Paper provided by World Intellectual Property Organization - Economics and Statistics Division in its series WIPO Economic Research Working Papers with number 01.

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Length: 32 pages
Date of creation: Dec 2010
Date of revision: Dec 2010
Publication status: Published in Journal of Productivity Analysis, October 2014, Volume 42, Issue 2, pp 137-155
Handle: RePEc:wip:wpaper:01
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Phone: +41 22 338 9111
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