R&D Heterogeneity and Its Implications for Growth

Arbeitspapier

This paper quantifies the determinants of heterogeneity in R&D investment and its implications for growth. Using a panel of Norwegian manufacturing firms we document a negative correlation between R&D intensity and firm size, driven mainly by small firms with high R&D intensity. We estimate a Schumpeterian growth model with heterogeneous firms, that differ with respect to innovation efficiency. The estimated model fits the shape of the R&D investment distribution as well as the negative correlation between R&D intensity and firm size. A larger selection effect contribution to aggregate growth is found when we include R&D moments in the estimation. Finally, we study the link between firm heterogeneity and R&D subsidies, and show that the growth effects of subsidies depend crucially on how the policy influences the equilibrium distribution of firms.

Object Details

• ISBN: 978-82-7553-938-8
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 15/2016

Classification and Topics

• Classification: Wirtschaft ; Production, Pricing, and Market Structure; Size Distribution of Firms
• Subject: R&D ; heterogeneous firms ; subsidies ; growth

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Galaasen, Sigurd Mølster ; Irarrazabal, Alfonso
• Event: Veröffentlichung
• (who): Norges Bank
• (where): Oslo
• (when): 2016

Further information

• Handle: http://hdl.handle.net/10419/210104
• Last update: 10.03.2025, 11:41 AM CET