R&D-induced growth in the OECD?

Abstract

I use aggregate and industry-level data for a group of OECD countries for the period 1973 to 1991 to estimate a system implied by a model of R&Dinduced growth that relates R&D intensity, productivity, and output growth. I find evidence of positive long-run impact of R&D intensity on productivity and, ultimately, on the growth rate of output. The null hypothesis that growth is not induced by R&D is therefore rejected for this group of OECD countries. The estimation of the theoretically implied system of equations is more efficient and provides stronger results than the traditional estimation of individual equations in the microeconomic R&D literature. The results become stronger when using aggregate-level data suggesting spillovers from aggregate R&D.