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R&D investment and endogenous growth : a SVAR approach

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Issue Date
2009
Physical description
38 p. : gráf., tab.
Abstract
We develop the barebones of a highly stylized theoretical endogenous growth model for analyzing the impact of R&D investment on long run growth. We use this framework to identify a structural vector autoregressive (SVAR) model on GDP growth, inflation and R&D investment, along with the (exogenous) flows of global knowledge, for the period 1970-2006 for the six more developed economies plus Spain. Besides, we also study the impact of private and public R&D on economic activity and prices or whether public R&D investment crowds out private one. Overall, we find that R&D shocks have a positive impact on economic activity, but a heterogeneous effect on prices. Moreover, public R&D disturbances tend to crowd out private R&D investment, except in the less innovative economies. And finally, demand shocks tend to have a negative impact on private R&D spending in the short to medium-run
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Documentos de trabajo / Banco de España, 0925
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