Working Paper: NBER ID: w1068
Authors: Philippe Cuneo; Jacques Mairesse
Abstract: In a companion study to that of Griliches and Mairesse for the United States, we have investigated the relationship between output, labor, and physical and R&D capital during the 1972-1977 period for a sample of 182 R&D performing firms in the French nnufacturing industries. Our results are quite comparable to those obtained for the U.S. The relationship between firm productivity and R&D appears both strong and robust in the cross-sectional dimension of the data; it is less so in the time dimension. However, the within-firm estimates are still significant and of a likely order of magnitude.In this respect, they are more satisfactory than the U.S. ones. We show that this is largely due to a better measurement of the variables: (1) the fact that we can use a value-added measure of output instead of sales (or equivalently that we include materials among the factors of the production function); (2) the fact that we can correct the measures of labor, physical capital and output for the double counting or expensing out of the labor, capital and materials components of R&D expenditures.
Keywords: R&D; productivity; French manufacturing
JEL Codes: O32; D24
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| R&D expenditures (O32) | firm productivity (D22) |
| better measurement of variables (C39) | robustness of findings (C90) |
| double counting correction (C59) | estimated elasticity of R&D capital (O39) |
| R&D expenditures (O32) | elasticity of R&D capital (O39) |
| value-added measures of output (E23) | robustness of findings (C90) |