Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/71496
Authors: 
Griffith, Rachel
Redding, Stephen
Van Reenen, John
Year of Publication: 
2000
Series/Report no.: 
IFS Working Papers, Institute for Fiscal Studies (IFS) 01/03
Abstract: 
This paper presents a unified model that integrates the theoretical literatue on Schumpeterian endogenous growth, the microeconometric literature on R&D and productivity, and the empirical literature on productivity convergence. Starting from a structural model of endogenous growth following Aghion and Howitt (1992, 1998), we provide microeconomic foundations for a reduced-form equation for Total Factor Productivity (TFP) growth that is commonly used in the empirical literature. We allow a role for R&D in innovation and technology transfer (absorptive capacity). The analysis suggests that many existing studies underestimate R&D's social rate of return and provides an explanation for long-run productivity levels at the industry level.
Subjects: 
Absorptive capacity, endogenous growth, R&D, Total Factor Productivity (TFP)
JEL: 
O10
O30
O47
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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