R&D and price elasticity of demand

Arbeitspapier

This note explores the relationship between the price elasticity of demand and the R&D intensity of the product. We introduce the concept of R&D intensity into a standard Dixit-Stiglitz/Krugman-type setting. R&D activity is treated as a fixed cost of production. Within this framework, sectors with a higher R&D intensity show a lower price elasticity of demand. This proposition is confirmed by an empirical investigation of export demand for manufactured goods from major industrialised countries. Consequently, real exchange rate changes have an impact on the commodity structure of exports.

Objekt anzeigen

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DIW Discussion Papers ; No. 430

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Market Structure, Pricing, and Design: General ; Empirical Studies of Trade ; Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
• Thema: R&D intensity ; price elasticity ; exports ; Produkt ; Forschung ; Faktorintensität ; Preiselastizität ; Nachfrage ; Export ; Schätzung ; Theorie ; G7-Staaten

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Lucke, Dorothea ; Schröder, Philipp J. H. ; Schumacher, Dieter
• Ereignis: Veröffentlichung
• (wer): Deutsches Institut für Wirtschaftsforschung (DIW)
• (wo): Berlin
• (wann): 2004

Weitere Informationen

• Handle: http://hdl.handle.net/10419/18166