Is corporate R&D investment in high-tech sectors more effective?(Report): An article from: Contemporary Economic Policy
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ISBN / ASINB003W3QMPE
ISBN-13978B003W3QMP6
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This digital document is an article from Contemporary Economic Policy, published by Western Economic Association International on July 1, 2010. The length of the article is 7945 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available immediately after purchase. You can view it with any web browser.
From the author: This paper discusses the link between R&D and productivity across the European industrial and service sectors. The empirical analysis is based on both the European sectoral OECD data and on a unique micro longitudinal database consisting of 532 top European R&D investors. The main conclusions are as follows. First, the R&D stock has a significant positive impact on labor productivity; this general result is largely consistent with previous literature in terms of the sign, the significance, and the magnitude of the estimated coefficients. More interestingly, both at sectoral and firm levels the R&D coefficient increases monotonically (both in significance and magnitude) when we move from the low-tech to the medium- and high-tech sectors. This outcome means that corporate R&D investment is more effective in the high-tech sectors and this may need to be taken into account when designing policy instruments (subsidies, fiscal incentives, etc.) in support of private R&D. However, R&D investment is not the sole source of productivity gains; technological change embodied in gross investment is of comparable importance on aggregate and is the main determinant of productivity increase in the low-tech sectors. Hence, an economic policy aiming to increase productivity in the low-tech sectors should support overall capital formation.
Citation Details
Title: Is corporate R&D investment in high-tech sectors more effective?(Report)
Author: Raquel Ortega-Argiles
Publication:Contemporary Economic Policy (Magazine/Journal)
Date: July 1, 2010
Publisher: Western Economic Association International
Volume: 28 Issue: 3 Page: 353(13)
Article Type: Report
Distributed by Gale, a part of Cengage Learning
From the author: This paper discusses the link between R&D and productivity across the European industrial and service sectors. The empirical analysis is based on both the European sectoral OECD data and on a unique micro longitudinal database consisting of 532 top European R&D investors. The main conclusions are as follows. First, the R&D stock has a significant positive impact on labor productivity; this general result is largely consistent with previous literature in terms of the sign, the significance, and the magnitude of the estimated coefficients. More interestingly, both at sectoral and firm levels the R&D coefficient increases monotonically (both in significance and magnitude) when we move from the low-tech to the medium- and high-tech sectors. This outcome means that corporate R&D investment is more effective in the high-tech sectors and this may need to be taken into account when designing policy instruments (subsidies, fiscal incentives, etc.) in support of private R&D. However, R&D investment is not the sole source of productivity gains; technological change embodied in gross investment is of comparable importance on aggregate and is the main determinant of productivity increase in the low-tech sectors. Hence, an economic policy aiming to increase productivity in the low-tech sectors should support overall capital formation.
Citation Details
Title: Is corporate R&D investment in high-tech sectors more effective?(Report)
Author: Raquel Ortega-Argiles
Publication:Contemporary Economic Policy (Magazine/Journal)
Date: July 1, 2010
Publisher: Western Economic Association International
Volume: 28 Issue: 3 Page: 353(13)
Article Type: Report
Distributed by Gale, a part of Cengage Learning
