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Infrastructure and Public R&D Investments, and the Growth of Factor Productivity in US Manufacturing Industries

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  • M. Ishaq Nadiri
  • Theofanis P. Mamuneas

Abstract

In this paper we examine the effects of publicly financed infrastructure and R&D capital on the cost structure and productivity performance of twelve two-digit U.S. manufacturing industries. A general framework is developed to measure contribution of demand, relative input prices, technical change, as well as publicly financed capital on total factor productivity growth. The magnitude of the contribution of these sources varies considerably across industries: in some changes in demand dominate while in others changes in technology or relative prices are the main contributors. Publicly financed infrastructure and R&D capital contribute to productivity growth. However, the magnitudes of their contribution vary considerably across industries and on the whole they are not the major contributors to TFP in these industries.

Suggested Citation

  • 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.
    • Handle: RePEc:nbr:nberwo:4845
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    Cited by:

    1. Rivas, Luis A., 2003. "Income taxes, spending composition and long-run growth," European Economic Review, Elsevier, vol. 47(3), pages 477-503, June.
    2. Rioja, Felix K., 1999. "Productiveness and welfare implications of public infrastructure: a dynamic two-sector general equilibrium analysis," Journal of Development Economics, Elsevier, vol. 58(2), pages 387-404, April.
    3. Tarek M. Harchaoui & Faouzi Tarkhani & Paul Warren, 2004. "Public Infrastructure in Canada, 1961-2002," Canadian Public Policy, University of Toronto Press, vol. 30(3), pages 303-318, September.
    4. Danny Leung & Yi Zheng, 2012. "What affects MFP in the long-run? Evidence from Canadian industries," Applied Economics, Taylor & Francis Journals, vol. 44(6), pages 727-738, February.
    5. Mr. Philip R. Gerson, 1998. "The Impact of Fiscal Policy Variables on Output Growth," IMF Working Papers 1998/001, International Monetary Fund.
    6. Muhammad Javid, 2019. "Public and Private Infrastructure Investment and Economic Growth in Pakistan: An Aggregate and Disaggregate Analysis," Sustainability, MDPI, vol. 11(12), pages 1-22, June.
    7. Francesco Di Comite & D'Artis Kancs & Wouter Torfs, 2015. "Macroeconomic Modelling of R&D and Innovation Policies," JRC Research Reports JRC89558, Joint Research Centre.
    8. Dmitriy, Skrypnik, 2020. "Инфраструктура И Экономический Рост. «Бюджетный Маневр» В России [Infrastructure and economic growth. "Budgetary maneuver" in Russia]," MPRA Paper 104920, University Library of Munich, Germany.
    9. Bor, Yungchang Jeffery & Chuang, Yih-Chyi & Lai, Wei-Wen & Yang, Chung-Min, 2010. "A dynamic general equilibrium model for public R&D investment in Taiwan," Economic Modelling, Elsevier, vol. 27(1), pages 171-183, January.
    10. Skrypnik, D., 2024. "Infrastructure and economic growth in the context of the evolutionary theory of economic policy," Journal of the New Economic Association, New Economic Association, vol. 62(1), pages 117-142.
    11. Maryann Feldman, 1999. "The New Economics Of Innovation, Spillovers And Agglomeration: Areview Of Empirical Studies," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 8(1-2), pages 5-25.
    12. M. Ishaq Nadiri & Banani Nandi, 1996. "The Changing Structure of Cost and Demand for the U.S. Telecommunications Industry," NBER Working Papers 5820, National Bureau of Economic Research, Inc.
    13. Chansarn, Supachet, 2005. "The efficiency in Thai financial sector after the financial crisis," MPRA Paper 1776, University Library of Munich, Germany, revised Dec 2006.
    14. Jan-Egbert Sturm & Gerard H. Kuper,, 1996. "The dual approach to the public capital hypothesis: the case of The Netherlands," Working Papers 26, Centre for Economic Research, University of Groningen and University of Twente.
    15. 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.

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    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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