Do Spillovers Matter When Estimating Private Returns to R&D?

Markus Eberhardt, Christian Helmers () and Hubert Strauss

Discussion Papers from University of Nottingham, GEP

Abstract: A large body of literature estimates private returns to R&D adopting the Griliches knowledge production framework which ignores the potential impact of spillovers on consistent estimation. Using a panel of 12 manufacturing industries across ten OECD economies, we investigate whether ignoring spillovers leads to bias in the estimated private returns to R&D. We compare results from a common factor framework, which accounts for spillovers and other unobserved shocks, to those from a standard Griliches approach. Our findings confirm that conventional estimates conflate own-R&D and spillover effects, implying that spillovers cannot be ignored even when the interest lies exclusively in evaluating private returns to R&D.

Keywords: Productivity; R&D; Spillovers; Common Factor Model (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (19)

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https://www.nottingham.ac.uk/gep/documents/papers/2011/11-22.pdf (application/pdf)

Related works:
Journal Article: Do Spillovers Matter When Estimating Private Returns to R&D? (2013)
Working Paper: Do spillovers matter when estimating private returns to R&D? (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:not:notgep:11/22

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