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International Comparisons of R&D Expenditure: Does an R&D PPP make a difference?

Author

Listed:
  • Sean M. Dougherty

    (OECD)

  • Robert Inklaar

    (University of Groningen)

  • Robert H. McGuckin

    (The Conference Board)

  • Bart van Ark

    (The Conference Board and University of Groningen)

Abstract

Purchasing power parities (PPPs) for R&D expenditure in 19 manufacturing industries are developed for France, Germany, Japan, the Netherlands and the United Kingdom relative to the United States for the years 1997 and 1987. These PPPs are based on R&D input prices for specific cost categories and differ substantially from current practice of comparing R&D expenditure using GDP PPPs and deflators. After taking into account differences in the relative price of R&D labor and materials, separate PPPs for other R&D cost categories are less essential, and a simpler version using GDP PPPs for these other categories should suffice. Our preferred PPPs are used to compare international R&D costs and intensity. The results suggest that the efforts devoted to R&D in each country are more similar across countries than is apparent using the nominal R&D intensities that are currently the norm.

Suggested Citation

  • Sean M. Dougherty & Robert Inklaar & Robert H. McGuckin & Bart van Ark, 2003. "International Comparisons of R&D Expenditure: Does an R&D PPP make a difference?," Economics Program Working Papers 03-03, The Conference Board, Economics Program, revised Jun 2006.
    • Handle: RePEc:cnf:wpaper:0303
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    References listed on IDEAS

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    2. Carol Corrado & Jonathan Haskel & Cecilia Jona-Lasinio & Massimiliano Iommi, 2012. "Intangible Capital and Growth in Advanced Economies: Measurement Methods and Comparative Results," Economics Program Working Papers 12-03, The Conference Board, Economics Program.
    3. Jakob Madsen, 2008. "Semi-endogenous versus Schumpeterian growth models: testing the knowledge production function using international data," Journal of Economic Growth, Springer, vol. 13(1), pages 1-26, March.
    4. Stephane Lhuillery & Julio Raffo & Intan Hamdan-Livramento, 2016. "Measuring creativity: Learning from innovation measurement," WIPO Economic Research Working Papers 31, World Intellectual Property Organization - Economics and Statistics Division.
    5. Andrea Caggese & Ander Pérez-Orive, 2017. "Capital Misallocation and Secular Stagnation," Finance and Economics Discussion Series 2017-009, Board of Governors of the Federal Reserve System (U.S.).
    6. Evers, Lisa & Spengel, Christoph, 2014. "Effective tax rates under IP tax planning," ZEW Discussion Papers 14-111, ZEW - Leibniz Centre for European Economic Research.
    7. Robert H. McGuckin & Robert Inklaar & Bart van Ark & Sean M. Dougherty, 2004. "The Structure of Business R&D: Recent Trends and Measurement Implications," Economics Program Working Papers 04-01, The Conference Board, Economics Program.
    8. Lisa Evers & Helen Miller & Christoph Spengel, 2015. "Intellectual property box regimes: effective tax rates and tax policy considerations," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(3), pages 502-530, June.
    9. Heisey, Paul W & Fuglie, Keith O., 2018. "Agricultural Research Investment and Policy Reform in High-Income Countries," Economic Research Report 276235, United States Department of Agriculture, Economic Research Service.
    10. Gersbach, Hans & Schneider, Maik & Schetter, Ulrich, 2015. "How Much Science? The 5 Ws (and 1 H) of Investing in Basic Research," CEPR Discussion Papers 10482, C.E.P.R. Discussion Papers.
    11. Haskel, Jonathan & Iommi, Massimiliano, 2012. "Intangible Capital and Growth in Advanced Economies: Measurement and Comparative Results," CEPR Discussion Papers 9061, C.E.P.R. Discussion Papers.
    12. Russell Thomson & Paul Jensen, 2013. "The Effects of Government Subsidies on Business R&D Employment: Evidence From Oecd Countries," National Tax Journal, National Tax Association;National Tax Journal, vol. 66(2), pages 281-310, June.
    13. Carol Coorado & Jonathan Haskel & Cecilia Iona Lasinio & Massimiliano Iommi, 2012. "Intangible Capital and Growth Strategies for Advanced Economies: Measurement and Comparative Results," Working Papers LuissLab 12101, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    14. Dag. W. Aksnes & Gunnar Sivertsen & Thed N. van Leeuwen & Kaja K. Wendt, 2017. "Measuring the productivity of national R&D systems: Challenges in cross-national comparisons of R&D input and publication output indicators," Science and Public Policy, Oxford University Press, vol. 44(2), pages 246-258.
    15. Sabine Visser, 2007. "R&D in Worldscan," CPB Memorandum 189.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    16. Timmer, Marcel & Ypma, Gerard & van Ark, Bart van, 2007. "PPPs for Industry Output: A New Dataset for International Comparisons," GGDC Research Memorandum GD-82, Groningen Growth and Development Centre, University of Groningen.
    17. Suen, Richard M.H., 2013. "Research Policy and U.S. Economic Growth," MPRA Paper 49103, University Library of Munich, Germany.
    18. Margareta Stela FLORESCU & Alina ªtefania CREÞU, 2013. "Management of Financial Resources for Scientific Research in Universities in Romania," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 14(3), pages 415-424, July.
    19. Sabine Visser, 2007. "R&D in Worldscan," CPB Memorandum 189, CPB Netherlands Bureau for Economic Policy Analysis.

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    More about this item

    Keywords

    R&D; PPP; price indexes; research; development; innovation;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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