Working Paper #2020-013
Semi-endogenous growth models with domestic and foreign private and public R&D linked to VECMs with evidence for five countries
We present semi-endogenous growth models with productivity as functions
of domestic and foreign private and public R&D. In a small country case
with a Cobb-Douglas productivity production function, foreign R&D drives
steady-state growth and the production function can be a long-term
relation in a vector-error-correction model (VECM). Marginal
productivity conditions can be long-term relations for a
vector-error-correction model if the functional form is of a VES
function generalising a CES function. Combining the marginal products of
VES functions with recent evidence from VECMs for five countries shows
that private and public R&D have a positive effect on productivity
(except for France), and a negative R&D augmenting technical change. In
case of a VES function, steady states with constant R&D/productivity
ratios exist only for special cases of parameter restrictions, which are
not supported by the evidence.
- Keywords
-
- Productivity
- endogenous (un)balanced growth
- public R&D expenditure
- foreign spillover
- JEL codes
-
- O38
- O40
- O41
- H54
- H87
Cite this as
APA 7th ed.Ziesemer, T. (2020). Semi-endogenous growth models with domestic and foreign private and public R&D linked to VECMs with evidence for five countries (UNU-MERIT Working Paper No. 2020-013). UNU-MERIT. https://unu-merit.nl/publications/working-papers/abstract/?id=8484