R&D, Production Structure, and Productivity Growth in the U.S., Japaneseand German Manufacturing Sectors

53 Pages Posted: 14 Jul 2000

See all articles by Pierre Mohnen

Pierre Mohnen

Maastricht University - UNU-MERIT

M. Ishaq Nadiri

New York University (NYU) - Department of Economics; National Bureau of Economic Research (NBER)

Ingmar R. Prucha

University of Maryland; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Date Written: 1984

Abstract

The paper analyzes the production structure and the demand for inputs in three major industrialized countries, the U.S., Japan and Germany. A dynamic factor demand model with two variable inputs (labor and energy)and two quasi-fixed inputs (capital and R&D) is derived directly from an intertemporal cost-minimization problem formulated in discrete time. Adjustment costs are explicitly specified. The model is estimated for the manufacturing sector of the three countries using annual data from 1965 to 1977. Particular attention is given to the role of R&D. For all countries the rate of return on R&D is found to be higher than that on capital. Their respective magnitudes are similar across countries.We find considerable differences in factor demand schedules; we also find that for all countries the speed of adjustment for capital is higher than that of R&D. Adjustment costs are of importance in the demand equations for capital and R&D, but play a minor role in the decomposition of total factor productivity growth.

Suggested Citation

Mohnen, Pierre and Nadiri, M. Ishaq and Prucha, Ingmar R., R&D, Production Structure, and Productivity Growth in the U.S., Japaneseand German Manufacturing Sectors (1984). NBER Working Paper No. w1264. Available at SSRN: https://ssrn.com/abstract=227552

Pierre Mohnen (Contact Author)

Maastricht University - UNU-MERIT ( email )

P.O. Box 616
Maastricht, 6200 MD
Netherlands
31-43-3884464 (Phone)
31-43-3884495 (Fax)

M. Ishaq Nadiri

New York University (NYU) - Department of Economics ( email )

269 Mercer Street, 7th Floor
New York, NY 10011
United States
212-998-8968 (Phone)
212-995-4013 (Fax)

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
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Ingmar R. Prucha

University of Maryland ( email )

Department of Ecomics
College Park, MD 20742
United States
301-405-3499 (Phone)
301-405-3542 (Fax)

HOME PAGE: http://www.econ.umd.edu/~prucha/

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

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