Working Paper: NBER ID: w4845
Authors: M. Ishaq Nadiri; Theofanis P. Mamuneas
Abstract: In this paper we examine the effects of publicly financed infrastructure and R&D capital on the cost structure and productivity performance of twelve two-digit U.S. manufacturing industries. A general framework is developed to measure contribution of demand, relative input prices, technical change, as well as publicly financed capital on total factor productivity growth. The magnitude of the contribution of these sources varies considerably across industries: in some changes in demand dominate while in others changes in technology or relative prices are the main contributors. Publicly financed infrastructure and R&D capital contribute to productivity growth. However, the magnitudes of their contribution vary considerably across industries and on the whole they are not the major contributors to TFP in these industries.
Keywords: Public Infrastructure; R&D Investments; Productivity Growth; Manufacturing Industries
JEL Codes: O47; H54; L52
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Publicly financed infrastructure (H54) | TFP growth (O49) |
| R&D capital (O32) | TFP growth (O49) |
| Changes in demand (J23) | TFP growth (O49) |
| Changes in technology (O33) | TFP growth (O49) |
| Relative prices (P22) | TFP growth (O49) |