DP1467 R&D Spillovers and Global Growth

Author(s): Tamim Bayoumi, David T Coe, Elhanan Helpman
Publication Date: August 1996
Keyword(s): North-South, Productivity, R&D, Spillovers
JEL(s): O31, O40
Programme Areas: International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=1467

We examine the growth promoting roles of R&D, international R&D spillovers, and trade in a world econometric model. A country can raise its total factor productivity by investing in R&D. Countries can also boost their productivity by trading with other countries that have large ?stocks of knowledge? from their cumulative R&D activities. We use a special version of MULTIMOD that incorporates R&D spillovers among industrial countries and from industrial countries to developing countries. Our simulations suggest that R&D, R&D spillovers, and trade play important roles in boosting growth in industrial and developing countries.