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R&D and productivity: testing sectoral peculiarities using micro data

Empirical Economics volume 41, pages 817–839 (2011)Cite this article

Abstract

The aim of this study is to investigate the relationship between a firm’s R&D activities and its productivity using a unique micro data panel dataset and looking at sectoral peculiarities which may emerge; more specifically, we used an unbalanced longitudinal database consisting of 532 top European R&D investors over the 6-year period 2000–2005. Our main findings can be summarised along the following lines: knowledge stock has a significant positive impact on a firm’s productivity, with an overall elasticity of about 0.104; this general result is largely consistent with previous literature in terms of the sign, the significance and the estimated magnitude of the relevant coefficient. More interestingly, the coefficient increases monotonically when we move from the low-tech to the medium-high and high-tech sectors, ranging from a minimum of 0.03/0.05 to a maximum of 0.14/0.17. This outcome suggests that firms in high-tech sectors are still far ahead in terms of the impact on productivity of their R&D investments, at least as regards top European R&D investors.

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Authors and Affiliations

  1. IN+ Center for Innovation, Technology and Policy Research, Instituto Superior Técnico IST, Av.Rovisco País, 1049-001, Lisboa, Portugal

    Raquel Ortega-Argilés

  2. Utrecht School of Economics, Janskerkhof 12, 3512 BL, Utrecht, The Netherlands

    Lesley Potters

  3. Facoltà di Economia, Università Cattolica del Sacro Cuore, Via Emilia Parmense 84, 29100, Piacenza, Italy

    Marco Vivarelli

Authors
  1. Raquel Ortega-Argilés
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  2. Lesley Potters
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  3. Marco Vivarelli
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Corresponding author

Correspondence to Raquel Ortega-Argilés.

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The main work of this paper was carried out while the authors were staff at the European Commission, Joint Research Centre (JRC), Institute for Prospective Technological Studies (IPTS). Edificio Expo, C/ Inca Garcilaso 3, 41092 Seville, Spain.

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Ortega-Argilés, R., Potters, L. & Vivarelli, M. R&D and productivity: testing sectoral peculiarities using micro data. Empir Econ 41, 817–839 (2011). https://doi.org/10.1007/s00181-010-0406-3

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  • DOI: https://doi.org/10.1007/s00181-010-0406-3

Keywords

  • R&D
  • Productivity
  • Knowledge stock
  • Panel data
  • Perpetual inventory method

JEL Classification

  • O33