share

Total Factor Productivity and R&D Capital in Manufacturing Industries

by 

Jeong Yeon Lee and Jung Woo Kim

East-West Center Working Papers, Economics Series, No. 89

Publisher:

Honolulu: East-West Center

Publication Date: June 2006
Binding: paper
Pages: 16
Free Download: PDF

 

This study analyzes total factor productivity in manufacturing industries for a sample of OECD countries. The estimates of Malmquist indexes clearly indicate that research and development (R&D) capital is an important determinant of productivity growth in manufacturing industries. The empirical results also show that it is the pace, not the intensity, of R&D investment that is significantly related to the extent to which R&D capital formation contributes to output growth. Furthermore, this study finds that productivity gains in manufacturing industries depend importantly on R&D spillovers as well.