DP4894 Firms' Productivity Growth and R&D Spillovers: An Analysis of Alternative Technological Proximity Measures

Author(s): Michele Cincera
Publication Date: February 2005
Keyword(s): clustering, panel data, productivity growth, R&D Spillovers
JEL(s): O12, O33, O47
Programme Areas: Industrial Organization
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=4894

This paper aims at assessing the impact of R&D spillovers on firms? economic performance as measured by productivity growth. The construction of R&D spillovers is based on Jaffe?s methodology (1986, 1988), which associates econometrics and data analysis. The main objective of the paper is to extend Jaffe?s methodology by examining alternative methods for measuring R&D spillovers and to test their impacts in terms of the robustness of results. In particular, the method used to classify firms into technological clusters as well as the metrics implemented to appreciate firms? technological proximities which enter the construction of spillovers are further investigated. In addition to R&D spillovers, firms? own R&D capital, labour and physical capital are estimated by means of a Cobb-Douglas production function. The data set consists of a representative sample of 625 worldwide R&D-intensive firms over the period 1987-1994.