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The existence of R&D spillovers: A cost function estimation with random coefficients

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  • Petri Rouvinen

Abstract

This is a study of the effects of R&D spillovers on the cost and production structures of Finnish manufacturing firms. Confidential data on firms is used to estimate a translog cost function system with random coefficients. Although the results suggest that intra-industry spillovers are present in Finnish manufacturing, the findings regarding inter-industry spillovers are inconclusive. The variable cost reduction associated with spillovers is positive, but relatively low. Spillovers reduce the demand for labor but increase the demand for materials. Spillovers also reduce the willingness to pay for capital inputs.

Suggested Citation

  • Petri Rouvinen, 2002. "The existence of R&D spillovers: A cost function estimation with random coefficients," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 11(6), pages 525-541.
    • Handle: RePEc:taf:ecinnt:v:11:y:2002:i:6:p:525-541
    DOI: 10.1080/10438590214339
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    References listed on IDEAS

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    4. Julia Hall & Grant M Scobie, 2006. "The Role of R&D in Productivity Growth: The Case of Agriculture in New Zealand: 1927 to 2001," Treasury Working Paper Series 06/01, New Zealand Treasury.
    5. Dirk Czarnitzki & Kornelius Kraft, 2012. "Spillovers of innovation activities and their profitability," Oxford Economic Papers, Oxford University Press, vol. 64(2), pages 302-322, April.
    6. Hyytinen, Ari & Pajarinen, Mika (ed.), . "Financial Systems and Firm Performance. Theoretical and Empirical Perspectives," ETLA B, The Research Institute of the Finnish Economy, number 200, June.
    7. Hall, Bronwyn H. & Mairesse, Jacques & Mohnen, Pierre, 2010. "Measuring the Returns to R&D," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 2, chapter 0, pages 1033-1082, Elsevier.
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    10. LEE, Keun & CHOO, Kineung & Yoon, Minho, 2013. "Comparing the Productivity Impacts of Knowledge Spillovers from Network and Arm’s Length Industries:Findings from Business Groups in Korea," IIR Working Paper 13-15, Institute of Innovation Research, Hitotsubashi University.
    11. Belderbos, René & Mohnen, Pierre, 2020. "Inter-sectoral and international R&D spillovers," MERIT Working Papers 2020-047, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
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