Complementarity between private and public investment in R&D: A Dynamic Panel Data analysis
Abstract
This paper investigates the relationship between private and public investment in R&D, while taking into account the effect of several instruments policies such as subsidies and taxes. We design a new look of knowledge spillovers and R&D cooperation to explain the contribution of public and private R&D on growth. We propose a heterogeneous dynamic panel data model to consider the endogenous effect of R&D investment. We also distinguish between the estimated long and short run results. Our results based on a sample of 23 countries over the period 1992-2004 indicate that both public and private investments in R&D are complementary. By establishing an endogenous growth model, the estimates indicate that public and private R&D depends on the host country's human capital investment. Results indicate that foreign direct investment is a more significant spillover channel than imports.
Keywords
Cite
@article{arxiv.0905.4272,
title = {Complementarity between private and public investment in R&D: A Dynamic Panel Data analysis},
author = {Sadraoui Tarek and Naceur Ben Zina},
journal= {arXiv preprint arXiv:0905.4272},
year = {2010}
}