TY  - JOUR
AU  - Bottazzi,Laura
AU  - Peri,Giovanni
TI  - The International Dynamics of R&D and Innovation in the Short and in the Long Run
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 11524
PY  - 2005
Y2  - August 2005
UR  - http://www.nber.org/papers/w11524
L1  - http://www.nber.org/papers/w11524.pdf
N1  - Author contact info:
Laura Bottazzi
Department of Economics
Bologna University
StradaMaggiore 45
40126 BOLOGNA
Italy
E-Mail: l.bottazzi@unibo.it

Giovanni Peri
Department of Economics
University of California, Davis
One Shields Avenue
Davis, CA 95616
Tel: 530/752-3033
E-Mail: gperi@ucdavis.edu
M2  - featured in NBER digest on 2005-08-01
AB  - In this paper we estimate the dynamic relationship between employment in R&D and generation of knowledge as measured by patent applications across OECD countries. In several recently developed models, known as `idea-based' models of growth, the afore mentioned "idea-generating" process is the engine of productivity growth. Moreover, in real business cycle models technological shocks are an important source of fluctuations. Our empirical strategy is able to test whether knowledge spillovers are strong enough to generate sustained endogenous growth and to estimate the quantitative impact of international knowledge on technological innovation of a country in the short and in the long run. We find that a country's stock of knowledge, its R&D resources and the stock of international knowledge move together in the long run. International knowledge has a very significant impact on innovation. As a consequence, a positive shock to R&D in the US (the largest world innovator) has a significant positive effect on the innovation of all other countries. Such a shock produces its largest effect on domestic and international innovation after five to ten years from its occurrence.
ER  -