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R&D and productivity in the US and the EU: sectoral specificities and differences in the crisis

Castellani, D., Piva, M., Schubert, T. and Vivarelli, M. (2019) R&D and productivity in the US and the EU: sectoral specificities and differences in the crisis. Technological Forecasting and Social Change, 138. pp. 279-291. ISSN 0040-1625

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To link to this item DOI: 10.1016/j.techfore.2018.10.001

Abstract/Summary

Using data on the US and EU top R&D spenders from 2004 until 2012, this paper investigates the sources of the US/EU productivity gap. We find robust evidence that US firms have a higher capacity to translate R&D into productivity gains (especially in the high-tech macro sector), and this contributes to explaining the higher productivity of US firms. Conversely, EU firms are more likely to achieve productivity gains through capital-embodied technological change, at least in the medium- and low-tech macro sectors. Our results also show that the US/EU productivity gap has worsened during the crisis period, as the EU companies have been more affected by the economic crisis in their capacity to translate R&D investments into productivity. Based on these findings, we make a case for a learning-based and selective R&D funding, which, instead of purely aiming at stimulating higher R&D expenditures, works on improving the firms’ capabilities to transform R&D into productivity gains.

Item Type:Article
Refereed:Yes
Divisions:Henley Business School > International Business and Strategy
ID Code:79822
Publisher:Elsevier

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