Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/202155
Authors: 
Di Comite, Francesco
Kancs, d’Artis
Year of Publication: 
2015
Series/Report no.: 
IPTS Working Papers on Corporate R&D and Innovation 03/2015
Abstract: 
This report compares R&D modelling approaches in four macroeconomic models used by the European Commission for ex-ante policy impact assessment: one Dynamic Stochastic General Equilibrium (DSGE) model – QUEST; one Spatial Computable General Equilibrium (SCGE) model – RHOMOLO; one Computable General Equilibrium (CGE) model – GEM-E3; and one macro-econometric model – NEMESIS. The report critically compares particularly those parts of the four models that are relevant to R&D transmission mechanisms and interfaces for implementing policy shocks. Given that R&D investment decisions are inherently dynamic, QUEST appears to be the most suitable model for assessing the impact of R&D and innovation policies over time, as it is the only model with inter-temporal optimisation of economic agents. In order to address questions related to geographic concentration of innovative activities and spatial knowledge spillovers, RHOMOLO has a comparative advantage, as it is the only one which models regional economies and spatial interactions between them explicitly. Due to its detailed treatment of energy sectors and environmental issues, GEM-E3 appears to be the most suitable model for assessing the impact of innovation in clean energy. For a more detailed modelling of different types of innovation measures, NEMESIS can provide valuable insights thanks to its richness in estimating and accounting for specific channels of innovation. We also identify avenues for future research, which in our view could improve the modelling of R&D and innovation policies both from a conceptual and empirical perspective.
Subjects: 
RHOMOLO
QUEST
GEM-E3
NEMESIS
Macro-Economic Models
General Equilibrium
R&D Policies
JEL: 
C68
D24
D58
H50
O31
O32
Persistent Identifier of the first edition: 
ISBN: 
978-92-79-45241-3
Document Type: 
Working Paper
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