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|Title:||Corporate R&D and firm efficiency: Evidence from Europe's top R&D investors|
|Authors:||KUMBHAKAR Subal; ORTEGA ARGILÉS Raquel; POTTERS Lesley; VIVARELLI Marco; VOIGT PETER|
|Citation:||JOURNAL OF PRODUCTIVITY ANALYSIS p. 1-16|
|Type:||Articles in periodicals and books|
|Abstract:||The main objective of this study is to investigate the impact of corporate research and development (R&D) activities on firm performance, measured by labour productivity. To this end, the stochastic frontier technique is used on a unique unbalanced longitudinal dataset comprising top European R&D investors over the period 2000–2005. In this framework, this study quantifies technical inefficiency of individual firms. From a policy perspective, the results of this study suggest that if the aim is to leverage firms’ productivity, the emphasis should be put on supporting corporate R&D in high-tech sectors and, to some extent, in medium-tech sectors. On the other hand, corporate R&D in the low-tech sector is found to have a minor effect in explaining productivity. Instead, encouraging investment in fixed assets appears important for the productivity of low-tech industries. Hence, the allocation of support for corporate R&D seems to be as important as its overall increase and an ‘erga omnes’ approach across all sectors appears inappropriate. However, with regard to technical efficiency, R&D intensity is found to be a pivotal factor in explaining firm efficiency and this turns out to be true for all industries.|
|JRC Institute:||Growth and Innovation|
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