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Impacts of research and development on manufacturing trade

Author

Listed:
  • Stefan Bojnec

    (University of Primorska, Faculty of Management, Koper, Slovenia)

  • Imre Ferto

    (Corvinus University of Budapest and Hungarian Academy of Sciences, Budapest, Hungary)

Abstract

The basic aim of the research is to investigate the impacts of research and development (R&D) on manufacturing trade. Six hypotheses are tested. The focus is on possible non-linear effect of R&D on trade flows and whether R&D helps overcome the distance and the role of level of economic development on manufacturing trade. The panel unit root test and panel econometric methods are employed on the adapted gravity trade model using the panel data for Organisation for Economic Cooperation and Development (OECD) countries during the period 1995-2003. The results of the research indicate that R&D is positively associated with manufacturing trade for exporting countries, while results are mixed for importing countries. The results reject the non-linear relationship between R&D and manufacturing exports. Estimations suggest that R&D may contribute to overcoming the effects of distance on manufacturing exports and may strengthen import specialization. R&D is found as the way to foster exports of manufacturing products from developing to developed OECD countries.

Suggested Citation

  • Stefan Bojnec & Imre Ferto, 2011. "Impacts of research and development on manufacturing trade," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 29(1), pages 65-88.
    • Handle: RePEc:rfe:zbefri:v:29:y:2011:i:1:p:65-88
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    manufacturing trade; research and development; distance; level of economic development; OECD countries; adapted gravity equation; panel data analysis;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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