Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
10482507 | Research Policy | 2016 | 13 Pages |
Abstract
The present paper studies the relationship between R&D investment and firm productivity growth by explicitly modelling non-linearities in the R&D-productivity relationship. We employ a two step estimation approach, and match two firm-level data sets for OECD countries, which allows us to relax the linearity assumption of the canonical Griliches (1979) knowledge capital model. Our results suggest that: (i) R&D investment increases firm productivity with an average elasticity of 0.15; (ii) the impact of R&D investment on firm productivity is different at different levels of R&D intensity-the productivity elasticity ranges from â0.02 for low levels of R&D intensity to 0.33 for high levels of R&D intensity implying that the relationship between R&D expenditures and productivity growth is highly non-linear, and only after a certain critical mass of knowledge is accumulated, is productivity growth significantly positive; (iii) there are important inter-sectoral differences with respect to R&D investment and firm productivity-firms in high-tech sectors not only invest more in R&D, but also achieve more in terms of productivity gains related to research activities.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Business and International Management
Authors
d'Artis Kancs, Boriss Siliverstovs,