Economics at your fingertips  

The impact of R&D and innovation on global supply chain transition: GTAP analysis on Japan’s public R&D investment

Michael C. Huang (), Ming-Huan Liou and Yoko Iwaki
Additional contact information
Michael C. Huang: The Sasakawa Peace Foundation (SPF)
Ming-Huan Liou: Industrial Technology Research Institute (ITRI)
Yoko Iwaki: National Graduate Institute for Policy Studies (GRIPS)

Journal of Social and Economic Development, 2021, vol. 23, issue 3, No 2, 447-467

Abstract: Abstract Policymaking for science, technology, and innovation (R&D) is stepping into a new era in the twenty-first century within a highly integrated production network, making it more challenging to capture the impact of R&D investment from an evidence-based approach. To unfold the paradox of the R&D spillover effect spared in the global supply chain, we use computable general equilibrium model with the GTAP database v10 to analyze the impact of Japan’s public R&D investment to the world focus on key sectors of global supply chain, namely chemical and pharmaceutical, electronic equipment, machinery, and transportation equipment to examine its output, external trades, and welfare. The productivity parameters triggered by public R&D investment are calibrated from the SciREX Policymaking Intelligent Assistance System—Economic Simulator (SPIAS-e). The simulation results show significant increase in Japan’s output and export for chemical and pharmaceutical, electronic equipment, and transportation equipment. The GDP growth was stimulated by 0.6% and substantial welfare improvement by USD 78,000 million, while other countries such as Malaysia and Taiwan by 0.4–0.6%. In contrast, the economic indicators of China reveal a negative impact, implying a structural change in the composition of the production network. It is notable to see a higher economic integration of Oceania within the region through its vibrant production and trades. The study provides comprehensive global analysis on production networks and insights for evaluating the R&D investment spillover effects.

Keywords: GTAP 10; Public R&D investment; SPIAS-e; Global supply chain (search for similar items in EconPapers)
JEL-codes: C68 O31 O32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from

DOI: 10.1007/s40847-020-00113-1

Access Statistics for this article

Journal of Social and Economic Development is currently edited by M.G. Chandrakanth, D. Rajasekhar, Anand Inbanathan and S. Madheswaran

More articles in Journal of Social and Economic Development from Springer, Institute for Social and Economic Change
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

Page updated 2022-05-12
Handle: RePEc:spr:jsecdv:v:23:y:2021:i:3:d:10.1007_s40847-020-00113-1