Working Paper: NBER ID: w1547
Authors: Zvi Griliches
Abstract: A new data set (the NSF-Census match) containing information on the R&D expenditures, sales, employment, and other detail for approximately 1,000 largest manufacturing firms in the U.S. during 1957-1977 is analyzed using a standard production function framework augmented by the addition of an R&D "capital" and "mix" variables (basic as a fraction of total and privately financed as a fraction of total). The results indicate that R&D continued to contribute to productivity growth in U.S. manufacturing also in the 1970's, with no significant decline in its effectiveness as com-pared to the 1960's; that the contribution of the basic research component of such expenditures was significantly higher than its nominal ratio would imply; and that while federally financed R&D expenditures did have a positive effect on measured productivity growth of these firms, this effect was significantly smaller than the comparable contribution of privately financed R&D expenditures.
Keywords: Productivity; R&D; Basic Research; Manufacturing
JEL Codes: O31; O32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| R&D investments (O32) | productivity growth (O49) |
| basic research component of R&D expenditures (I23) | productivity growth (O49) |
| federally financed R&D expenditures (O32) | productivity growth (O49) |
| privately financed R&D expenditures (O32) | productivity growth (O49) |