Abstract
We analyze the dynamic interaction of Japan's total factor productivity (TFP), GDP, stocks of domestic and foreign private and public as well as mission-oriented R&D, called GBARD in OECD statistics, in a vector-error-correction model (VECM) for Japan with stock data for the period 1987-2016. Permanent policy changes show the following main results: (i) GBARD as well as private and public R&D each encourage growth rates of the other R&D stocks and of TFP and GDP, and (ii) all have high internal rates of return; (iii) Japan's R&D policies affect and are affected by foreign R & D; in particular, Japan's public R&D has a positive impact on European private R&D, whereas other OECD countries' R&D has a negative one. Japan's R&D policies should be supported by education policies enhancing especially the number of PhDs and IT personnel.
Original language | English |
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Pages (from-to) | 218-247 |
Number of pages | 30 |
Journal | Economics of Innovation and New Technology |
Volume | 33 |
Issue number | 2 |
Early online date | 1 Jan 2023 |
DOIs | |
Publication status | Published - 2024 |
JEL classifications
- f43 - Economic Growth of Open Economies
- o19 - "International Linkages to Development; Role of International Organizations"
- o47 - "Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence"
- o53 - Economywide Country Studies: Asia including Middle East
Keywords
- R&D
- productivity
- growth
- cointegration
- cointegrated vector-auto-regression model (VECM)
- DEVELOPMENT SPILLOVERS
- LONG-RUN
- INNOVATION
- SUBSIDIES
- DYNAMICS
- RETURNS
- MODELS