Technological Capital and Technical Progress in the G5 Countries
University of Cantabria - Department of Economics
Colin Powell Center for Policy Studies and Colin Powell School for Civic and Global Leadership
Adolfo C. Fernández
University of Cantabria
November 1, 2011
Journal of Applied Economics, Vol. XIV, No. 2 (November 2011), 343-361
We conduct an empirical application based on Coe and Helpman’s (1995) seminal work, in order to measure the elasticity of technical progress with respect to R&D capital for the G5 countries between 1971 and 2003. For this purpose, a series for technological capital is built for the 1990-2003 period, and linked with Coe and Helpman’s series for the 1971-1990 period. The technical progress of leading countries depends critically on the domestic R&D capital stock, in line with Coe and Helpman’s (1995) and Coe, Helpman and Hofmaister’s (2009) work. Nevertheless, there are some important differences. The estimations for the elasticity values appear to be higher and show larger differences between countries than in previous studies. Furthermore, the results give evidence in favour of Schumpeterian models, as TFP growth is positively related to the distance to the technological frontier represented by the US.
Keywords: technology, R&D spillovers, dynamic heterogeneity, catching-up
JEL Classification: O33, O50, O47
Date posted: May 22, 2012
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