Estimation of R&D depreciation rates: a suggested methodology and preliminary application

Ning Huang and Walter Diewert

Canadian Journal of Economics, 2011, vol. 44, issue 2, 387-412

Abstract: The 2008 version of the SNA has recommended capitalization of R&D expenditures. To implement this recommendation, we need to determine the depreciation rate of R&D capital. In this paper, we develop a simple model, based on a production function method that allows for monopolistic competition, to estimate the annual depreciation rate of R&D capital. We treat R&D capital as a technology shifter instead of as an explicit input factor. Both the R&D stock and the time variable are used to capture technological progress. Estimated R&D depreciation rates and markup factors are presented for the U.S. manufacturing sector and four U.S. knowledge-intensive industries.

JEL-codes: C32 C43 C81 D24 D43 D92 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (17)

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Related works:
Journal Article: Estimation of R&D depreciation rates: a suggested methodology and preliminary application (2011)
Working Paper: Estimation of R&D Depreciation Rates: A Suggested Methodology and Preliminary Application (2009)
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