IDEAS home Printed from https://ideas.repec.org/a/fep/journl/v13y2000i1p56-68.html
   My bibliography  Save this article

Effect of publicly and privately financed R&D on total factor productivity growth

Author

Listed:
  • Petri Niininen

    (VTT Group for Technology Studies, Finland)

Abstract

The effects of privately and publicly financed R&D on total factor productivity growth are examined. Total factor productivity (TFP) is decomposed into markup, exogenous demand, factor price, and publicly and privately financed R&D effects at the industry level. The constructed dataset consists of 11 Finnish manufacturing industries in 1975–1993. The results suggest that both privately and publicly financed R&D has a considerable effect on the TFP rate of growth but R&D explains only part of the technical progress. On the average, total R&D accounted for about 9 percent of the TFP rate of growth in manufacturing industries while one fourth of the growth could be attributed to the residual technical change. Exogenous demand effect was the biggest component, accounting almost for one third of the TFP rate of growth.

Suggested Citation

  • Petri Niininen, 2000. "Effect of publicly and privately financed R&D on total factor productivity growth," Finnish Economic Papers, Finnish Economic Association, vol. 13(1), pages 56-68, Spring.
    • Handle: RePEc:fep:journl:v:13:y:2000:i:1:p:56-68
    as

    Download full text from publisher

    File URL: http://www.taloustieteellinenyhdistys.fi/images/stories/fep/f2000_1e.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Zvi Griliches, 1998. "Returns to Research and Development Expenditures in the Private Sector," NBER Chapters, in: R&D and Productivity: The Econometric Evidence, pages 49-81, National Bureau of Economic Research, Inc.
    2. Julio J. Rotemberg & Michael Woodford, 1991. "Markups and the Business Cycle," NBER Chapters, in: NBER Macroeconomics Annual 1991, Volume 6, pages 63-140, National Bureau of Economic Research, Inc.
    3. Goldstein, Jonathan, 1986. "Markup Variability and Flexibility: Theory and Empirical Evidence," The Journal of Business, University of Chicago Press, vol. 59(4), pages 599-621, October.
    4. M. Ishaq Nadiri & Theofanis P. Mamuneas, 1994. "Infrastructure and Public R&D Investments, and the Growth of Factor Productivity in US Manufacturing Industries," NBER Working Papers 4845, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Juana Sanchez, 2014. "Non-technological and Mixed Modes of Innovation in the United States. Evidence from the Business Research and Development and Innovation Survey, 2008-2011," Working Papers 14-35, Center for Economic Studies, U.S. Census Bureau.
    2. Martin Falk, 2004. "An Empirical Analysis of Factors Explaining the Level of R&D Subsidies and their Productivity Effects. Evidence from Firm-Level Panel Data," WIFO Studies, WIFO, number 25317.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Federico Di Pace & Matthias Hertweck, 2019. "Labor Market Frictions, Monetary Policy, and Durable Goods," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 32, pages 274-304, April.
    2. Alberto BUCCI, 2004. "Economic growth in an enlarged Europe: the human capital and R&D dimensions," Departmental Working Papers 2004-22, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    3. Borota Milicevic, Teodora & Carlsson, Mikael, 2016. "Markups from Inventory Data and Export Intensity," Working Paper Series 2016:9, Uppsala University, Department of Economics.
    4. Harald Badinger & Fritz Breuss, 2004. "Has Austria's Accession to the EU Triggered an Increase in Competition? A Sectoral Markup Study," WIFO Working Papers 220, WIFO.
    5. Olivier Blanchard, 2000. "What Do We Know about Macroeconomics that Fisher and Wicksell Did Not?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(4), pages 1375-1409.
    6. Brito, Paulo B. & Costa, Luís F. & Dixon, Huw, 2013. "Non-smooth dynamics and multiple equilibria in a Cournot–Ramsey model with endogenous markups," Journal of Economic Dynamics and Control, Elsevier, vol. 37(11), pages 2287-2306.
    7. Oliver Hülsewig & Eric Mayer & Timo Wollmershäuser, 2006. "Bank Behavior and the Cost Channel of Monetary Transmission," CESifo Working Paper Series 1813, CESifo.
    8. Knudsen, Eirik Sjåholm, 2019. "Bad weather ahead: Pre-recession characteristics and the severity of recession impact," Journal of Business Research, Elsevier, vol. 104(C), pages 118-130.
    9. Ugur, Mehmet & Trushin, Eshref & Solomon, Edna & Guidi, Francesco, 2016. "R&D and productivity in OECD firms and industries: A hierarchical meta-regression analysis," Research Policy, Elsevier, vol. 45(10), pages 2069-2086.
    10. Sungki Hong, 2019. "Customer Capital, Markup Cyclicality, and Amplification," 2019 Meeting Papers 959, Society for Economic Dynamics.
    11. David, Paul A. & Hall, Bronwyn H. & Toole, Andrew A., 2000. "Is public R&D a complement or substitute for private R&D? A review of the econometric evidence," Research Policy, Elsevier, vol. 29(4-5), pages 497-529, April.
    12. Quaghebeur, Ewoud, 2019. "Learning And The Size Of The Government Spending Multiplier," Macroeconomic Dynamics, Cambridge University Press, vol. 23(8), pages 3189-3224, December.
    13. Mamuneas, Theofanis P., 1999. "Spillovers from publicly financed R&D capital in high-tech industries," International Journal of Industrial Organization, Elsevier, vol. 17(2), pages 215-239, February.
    14. Susanto Basu & Luigi Pascali & Fabio Schiantarelli & Luis Serven, 2022. "Productivity and the Welfare of Nations," Journal of the European Economic Association, European Economic Association, vol. 20(4), pages 1647-1682.
    15. Hassan Afrouzi & Luigi Caloi, 2024. "Endogenous Firm Competition and the Cyclicality of Markups," The Review of Economics and Statistics, MIT Press, vol. 106(6), pages 1638-1654, November.
    16. Shiou‐Yen Chu, 2022. "Markups, inequality and monetary‐fiscal policies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 69(4), pages 367-395, September.
    17. Jaimovich, Nir, 2007. "Firm dynamics and markup variations: Implications for sunspot equilibria and endogenous economic fluctuations," Journal of Economic Theory, Elsevier, vol. 137(1), pages 300-325, November.
    18. Agenor, Pierre-Richard & McDermott, C John & Prasad, Eswar S, 2000. "Macroeconomic Fluctuations in Developing Countries: Some Stylized Facts," The World Bank Economic Review, World Bank, vol. 14(2), pages 251-285, May.
    19. Bruno Chiarini, 1998. "Cyclicality of real wages and adjustment costs," Applied Economics, Taylor & Francis Journals, vol. 30(9), pages 1239-1250.
    20. René Lalonde & Zhenhua Zhu & Frédérick Demers, 2003. "Forecasting and Analyzing World Commodity Prices," Money Affairs, CEMLA, vol. 0(1), pages 1-30, January-J.

    More about this item

    JEL classification:

    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fep:journl:v:13:y:2000:i:1:p:56-68. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Editorial Secretary The email address of this maintainer does not seem to be valid anymore. Please ask Editorial Secretary to update the entry or send us the correct address (email available below). General contact details of provider: https://edirc.repec.org/data/talouea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.