What drives business Research and Development (R&D) intensity across Organisation for Economic Co-operation and Development (OECD) countries?
Year: 2006
Type: article
Abstract: This paper empirically investigates the potential determinants of business-sector R&D intensity using a panel of OECD (countries for the period of 1975–2002 with data measured as five-year averages). Estimates using a system GMM estimator controlling for endogeneity show a high degree of persistence in business-sector R&D expenditures. Tax incentives for R&D have a significant and positive impact on business R&D spending regardless of the specification and estimation techniques. Furthermore, we find that expenditures for R&D performed by universities are significantly positively related to business enterprise sector expenditures on R&D indicating that public sector R&D and private R&D are complements. Direct R&D subsidies and the high-tech export share are significantly positively related to business-sector R&D intensity, but these effects are only significant using the first-differenced GMM estimator. The static fixed effects results show that countries characterised by strong patent rights appear to have higher R&D intensities, but this effect is no longer significant in the dynamic panel data model.
Source: Applied Economics
Author: Martin Falk
Institution: Austrian Institute of Economic Research
Language: English
Topic: Innovation Policy and R&D
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2015700442