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Stepping on toes in the production of knowledge: a meta-regression analysis
Applied Economics
Abstract
Decreasing returns to scale in physical resources in the knowledge production function have been widely considered in the economic growth literature. However, given the heterogeneity of empirical results, it is difficult to assess its magnitude. We provide a meta-analysis of the value of the decreasing returns to physical resources in the knowledge production function (stepping-on-toes effect). This has important policy implications regarding the subsidization of R&D activities and policy measures to enable the diffusion of knowledge. We conclude that there is some evidence of publication bias. Moreover, the average effect size is quite small, around 0.2, which implies a high stepping-on-toes effect. This value tends to be higher when variables related to international linkages are present, resources allocated to R&D are measured by labour, the knowledge pool is proxied by population, and instrumental variable estimation techniques are employed. On the contrary, the average returns to scale estimate decreases when resources allocated to R&D are measured by population and when only rich countries are included in the sample.
... If > 1 researchers compliment each other (Trammell and Korinek, 2020). But if if < 1 is signifies diminishing returns, or what has been called the "stepping-on-toes" e↵ect (Sequeira and Neves, 2020;Abdih and Joutz, 2005). It could for instance reflect duplication e↵ects in R&D. ...
... Third, the world risk-free interest rate is set to r̅ = 0.04 as used by Schmitt-Grohé and Uribe (2003). Fourth, we follow the empirical literature on R&D (e.g., Sequeira & Neves, 2020) to set the "stepping on toes effect" as γ = 0.2. 7 The parameter that reflects the degree of international capital mobility κ is a key parameter in our analysis. ...
In this paper, we examine the effects of international capital mobility on innovation, growth, and optimal growth policies in a small open economy with R&D‐driven growth. Households can borrow funds from an imperfect international capital market to finance their investment in R&D firms. We show that the economy can reach a higher growth rate if international capital is more mobile. This result is consistent with recent empirical findings. Moreover, we show that the common growth‐enhancing policies, such as patent protection and the R&D subsidies, have an additional negative welfare effect when households can access the international capital market. Accordingly, the optimal patent protection and R&D subsidy should be smaller when the degree of international capital mobility is higher.
This paper investigates optimal capital taxation in an innovation-driven growth model. We examine how the optimal capital tax rate varies with externalities associated with R&D and innovation. Our results show that the optimal capital tax rate is higher when (i) the “stepping on toes effect” is smaller, (ii) the “standing on shoulders effect” is stronger, or (iii) the extent of creative destruction is smaller. The optimal capital tax rate is more likely to be positive when there is underinvestment in R&D. Moreover, the optimal capital tax rate and the monopolistic markup exhibit an inverted-U relationship. By calibrating our model to the US economy, we find that the optimal capital tax rate is positive, at a rate of around 6.6%. Finally, we consider a number of extensions and find that the result of a positive optimal capital tax is robust.
El presente trabajo aborda la relación entre tamaño de la firma y desempeño innovador
desde un análisis de meta-regresión (AMR). La diversidad de coeficientes de regresión estimados reportados por la literatura empírica lleva a preguntarse si dicha disparidad se debe a la variabilidad muestral o si existen otros factores que moderan esta relación. El AMR es una metodología que permite responder esta pregunta y mediante la cual se pueden detectar sesgos en la publicación de resultados de investigaciones empíricas. A partir de una intensa revisión bibliográfica y de la conformación de una muestra de 125 artículos que reportan un total de 880 estimaciones econométricas de la citada relación, se analiza la presencia de heterogeneidad y de sesgo de publicación. Los resultados señalan indicios de sesgos de publicación; una vez descontado dicho sesgo, se observa
la persistencia de un efecto positivo del tamaño de la firma sobre el desempeño innovador.
In recent decades, intellectual property rights (IPR) and their macroeconomic effects have attracted considerable attention from both policymakers and academics. Despite a substantial theoretical and empirical literature, evidence regarding the impact of IPR protection on innovation and economic growth is mixed. In this paper we conduct a literature review and meta-analysis of the topic, and find that IPR have an overall positive effect on innovation and growth. However, the effect on innovation is weaker in developing countries than developed countries. We also find that the effects reported in the literature depend to a great extent on individual studies’ methodological characteristics.
En este documento se propone una función de producción del conocimiento, con base en la medición de variables no observables, que aporta una solución práctica a los problemas metodológicos en esta área de estudio. Al respecto, se define una función de producción de conocimiento que depende del capital humano, los gastos en investigación y desarrollo, los spillovers y el entorno innovador. La función es estimada con la técnica partial least squares path modeling, la cual permite medir el efecto de variables no observables. Se logró mostrar que estos constructos (variables latentes) son confiables y significativos; además, se concluye que esta función describe acertadamente cómo se crea y explota el conocimiento en una región.
Offshoring, either as FDI or offshore outsourcing, is a phenomenon of increasing importance that has been widely studied in the economics literature. Studies analysing the impact of offshoring on the labour market report divergent results. In this paper we develop a meta-analysis of the empirical literature that estimates the effect of offshoring on wages. We find that, after correcting for the presence of publication bias, the average effect is not significantly different from zero in either the origin or the destination countries. We also find that the wage impact of offshoring depends on methodological characteristics of the primary studies, such as the way offshoring is measured, the nature of goods/services that are offshored, the workers’ skill level, the unit of analysis, the structure of the data, and the estimation technique.
This paper investigates the innovation capacity driving factors in 11 Euro-Mediterranean countries for the period 2000–2012. The countries are chosen according to its capacity for innovation index and the availability of statistics. Our robust estimation is based on the one-step system generalized method of moments (GMM). We found that the most of hypothesis elaborated in the context of developed and emerging countries do not fit with the context of the less innovative countries as they are not knowledge-based economies. The economic growth, the foreign investment (FDI), and the employment in R&D are positive factors that foster the innovation. However, the labor force with tertiary education, the wages, the private funding of R&D, the financial development, and the technological infrastructure are negative factors that deter the innovation. Moreover, this study bridges a gap in the extant literature by examining the main determinants of the innovation capacity in the developing countries located in the same region. Neither this sample of the countries nor this time period has been the subject of investigation by other researchers in the literature.
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The ideas production function is at the heart of endogenous growth theory. Using data for Europe, its offshoots, and the Asian Tiger economies over the period from 1870 to 2010, this paper provides direct estimates of an ideas production function that explicitly distinguishes between the first- and second-generation endogenous growth models while allowing for human capital and international knowledge spillovers through various channels. The estimates show strong intertemporal and cross-country knowledge spillovers, provide robust support for Schumpeterian growth theory, and suggest that human capital and some channels of international knowledge spillover are influential for ideas production.
We model ‘new ideas’ production in a panel of 17 emerging countries. Our results reveal: (i) ideas production is duplicative, (ii) externality associated with domestic knowledge stocks is of above unit factor proportionality, (iii) OECD countries raise the innovation-bar for emerging countries, (iv) there is no significant knowledge diffusion across emerging countries, and (v) growth in emerging countries appear far from a balanced growth path.
Meta-analysis is arguably the most important methodological innovation in the social and behavioral sciences in the last 25 years. Developed to offer researchers an informative account of which methods are most useful in integrating research findings across studies, this book will enable the reader to apply, as well as understand, meta-analytic methods. Rather than taking an encyclopedic approach, the authors have focused on carefully developing those techniques that are most applicable to social science research, and have given a general conceptual description of more complex and rarely-used techniques. Fully revised and updated, Methods of Meta-Analysis, Second Edition is the most comprehensive text on meta-analysis available today. New to the Second Edition: * An evaluation of fixed versus random effects models for meta-analysis* New methods for correcting for indirect range restriction in meta-analysis* New developments in corrections for measurement error* A discussion of a new Windows-based program package for applying the meta-analysis methods presented in the book* A presentation of the theories of data underlying different approaches to meta-analysis
This paper studies the links between productivity, innovation and research at the firm level. We introduce three new features: (i) A structural model that explains productivity by innovation output, and innovation output by research investment: (ii) New data on French manufacturing firms, including the number of European patents and the percentage share of innovative sales, as well as firm-level demand pull and technology push indicators; (iii) Econometric methods which correct for selectivity and simultaneity biases and take into account the statistical features of the available data: only a small proportion of firms engage in research activities and/or apply for patents; productivity, innovation and research are endogenously determined; research investment and capital are truncated variables, patents are count data and innovative sales are interval data. We find that using the more widespread methods, and the more usual data and model specification, may lead to sensibly different estimates. We find in particular that simultaneity tends to interact with selectivity, and that both sources of biases must be taken into account together. However our main results are consistent with many of the stylized facts of the empirical literature. The probability of engaging in research (R&D) for a firm increases with its size (number of employees), its market share and diversification, and with the demand pull and technology push indicators. The research effort (R&D capital intensity) of a firm engaged in research increases with the same variables, except for size (its research capital being strictly proportional to size). The firm innovation output, as measured by patent numbers or innovative sales, rises with its research effort and with the demand pull and technology indicators, either directly or indirectly through their effects on research. Finally, firm productivity correlates positively with a higher innovation output, even when controlling for the skill composition of labor as well as for physical capital intensity.
Motivated by the 2006 report of a Work Group appointed by the Environmental Protection Agency (EPA), this paper examines the
present state of meta-analysis in environmental economics and offers recommendations for its future use. To this end we summarize
and assess 140 meta-analyses from 125 published and unpublished studies, covering 17 topical categories in environmental and
resource economics. First, we provide several generic meta-analysis models as reference points and discuss major estimation
issues. Five econometric issues are identified as part of a complete analysis: (1) sample selection criteria; (2) basic data
summary; (3) primary data heterogeneity; (4) heteroskedasticity; and (5) non-independence of multiple observations from primary
studies. Second, a tabular summary is presented for the 140 meta-analyses with respect to estimation methods. Third, a narrative
summary is presented for 19 meta-analyses, including the three value-of-statistical-life studies examined by the EPA Work
Group and one analysis from each of 16 other categories. Fourth, we offer a set of “best practice” guidelines for future meta-analyses
in this and other areas of economics. Last, the paper comments on the use of meta-analytic methods for benefit transfers of
environmental values.
This article uses data from 41 OECD and nonOECD (Organisation for Economic Co-operation and Development) countries to examine the predictions of nonscale endogenous growth theories that an increase in the share of researchers in labour force leads to an increase in innovation and innovation raises per capita output. The results show that an increase in the share of researchers in labour force increases innovation only in the large market OECD countries. Moreover, an increase in innovation raises
per labour GDP (Gross Domestic Product) in all nonOECD countries except for low income countries, while raising it only in the high-income OECD countries. These findings suggest that though the large market
OECD countries are the world leader in innovation, nonOECD countries benefit more from it in promoting their growth.
This paper estimates the parameters of the ideas production function crucial to recent ideas-driven growth models. Using U. S. patents granted to residents in OECD countries to generate the stock of commercially used ideas, we provide evidence for two main findings. First, at the level of the production of ideas, we find evidence of increasing returns to scale in the stock of ideas and number of researchers, but marginal decreasing returns in each one of these factors. Second, we provide evidence of the association between ideas growth and economic growth for the OECD as a whole in the long run. Copyright Springer-Verlag Berlin/Heidelberg 2005
Funnel plots (plots of effect estimates against sample size) may be useful to detect bias in meta-analyses that were later contradicted by large trials. We examined whether a simple test of asymmetry of funnel plots predicts discordance of results when meta-analyses are compared to large trials, and we assessed the prevalence of bias in published meta-analyses.
Medline search to identify pairs consisting of a meta-analysis and a single large trial (concordance of results was assumed if effects were in the same direction and the meta-analytic estimate was within 30% of the trial); analysis of funnel plots from 37 meta-analyses identified from a hand search of four leading general medicine journals 1993-6 and 38 meta-analyses from the second 1996 issue of the Cochrane Database of Systematic Reviews.
Degree of funnel plot asymmetry as measured by the intercept from regression of standard normal deviates against precision.
In the eight pairs of meta-analysis and large trial that were identified (five from cardiovascular medicine, one from diabetic medicine, one from geriatric medicine, one from perinatal medicine) there were four concordant and four discordant pairs. In all cases discordance was due to meta-analyses showing larger effects. Funnel plot asymmetry was present in three out of four discordant pairs but in none of concordant pairs. In 14 (38%) journal meta-analyses and 5 (13%) Cochrane reviews, funnel plot asymmetry indicated that there was bias.
A simple analysis of funnel plots provides a useful test for the likely presence of bias in meta-analyses, but as the capacity to detect bias will be limited when meta-analyses are based on a limited number of small trials the results from such analyses should be treated with considerable caution.
Cochrane Reviews have recently started including the quantity I 2 to help readers assess the consistency of the results of studies in meta-analyses. What does this new quantity mean, and why is assessment of heterogeneity so important to clinical practice?
Systematic reviews and meta-analyses can provide convincing and reliable evidence relevant to many aspects of medicine and health care.1 Their value is especially clear when the results of the studies they include show clinically important effects of similar magnitude. However, the conclusions are less clear when the included studies have differing results. In an attempt to establish whether studies are consistent, reports of meta-analyses commonly present a statistical test of heterogeneity. The test seeks to determine whether there are genuine differences underlying the results of the studies (heterogeneity), or whether the variation in findings is compatible with chance alone (homogeneity). However, the test is susceptible to the number of trials included in the meta-analysis. We have developed a new quantity, I 2, which we believe gives a better measure of the consistency between trials in a meta-analysis.
Assessment of the consistency of effects across studies is an essential part of meta-analysis. Unless we know how consistent the results of studies are, we cannot determine the generalisability of the findings of the meta-analysis. Indeed, several hierarchical systems for grading evidence state that the results of studies must be consistent or homogeneous to obtain the highest grading.2–4
Tests for heterogeneity are commonly used to decide on methods for combining studies and for concluding consistency or inconsistency of findings.5 6 But what does the test achieve in practice, and how should the resulting P values be interpreted?
A test for heterogeneity examines the null hypothesis that all studies are evaluating the same effect. The usual test statistic …
This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection as well as empirical evidence on the effects of patent rights. Then, the second part considers the international aspects of IPR protection. In summary, this paper draws the following conclusions from the literature. Firstly, different patent policy instruments have different effects on R&D and growth. Secondly, there is empirical evidence supporting a positive relationship between IPR protection and innovation, but the evidence is stronger for developed countries than for developing countries. Thirdly, the optimal level of IPR protection should tradeoff the social benefits of enhanced innovation against the social costs of multiple distortions and income inequality. Finally, in an open economy, achieving the globally optimal level of protection requires an international coordination (rather than the harmonization) of IPR protection.
Support for many R&D and technology policies relies on empirical evidence that R&D "spills over" between firms. But there are two countervailing R&D spillovers: positive effects from technology spillovers and negative effects from business stealing by product market rivals. We develop a general framework showing that technology and product market spillovers have testable implications for a range of performance indicators, and exploit these using distinct measures of a firm’s position in technology space and product market space. We show using panel data on U.S. firms between 1981 and 2001 that both technology and product market spillovers operate, but that net social returns are several times larger than private returns. The spillover effects are also revealed when we analyze three high-tech sectors in detail - pharmaceuticals, computer hardware and telecommunication equipment. Using the model we evaluate three R&D subsidy policies and show that the typical focus of support for small and medium firms may be misplaced.
The existence of geographically mediated "spillovers" from university research to commercial innovation is explored using state-level time-series data on corporate patents, corporate R&D, and university research. A significant effect of university research on corporate patents is found, particularly in the areas of drugs and medical technology, and electronics, optics, and nuclear technology. In addition, university research appears to have an indirect effect on local innovation by inducing industrial R&D spending. Copyright 1989 by American Economic Association.
This paper quantifies the effects of exogenous variations in the state of technology (technological opportunity) and of the R&D of other firms (spillovers of R&D) on the productivity of firms' R&D. The R&D productivity is increased by the R&D of "technological neighbors," though neighbors' R&D lowers the profits and market value of low-R&D-intensity firms. Firms are shown to adjust the technological composition of their R&D in response to technological opportunity. Copyright 1986 by American Economic Association.
The production of knowledge was subjected to quantitative analysis in the second half of the twentieth century, following The determinants of knowledge and the externalities present in the innovation process were discussed with immediate policy influence. In particular, the presence and strength of the spillover of the pool of past knowledge has encouraged high subsidization of R&D in the most developed countries. We survey the empirical literature on the spillover effect in the production of knowledge and implement a meta-analytic regression. We discover that the average spillover effect is less than but close to one and is highly significant. We also find that the spillover effect tends to be greater when the estimation of knowledge production accounts for foreign inputs, and it tends to be lower when the estimation includes only rich economies, regional data are used, and the pool of knowledge is not the patent stock.
The purpose of this book is to introduce novice researchers to the tools of meta-analysis and meta-regression analysis and to summarize the state of the art for existing practitioners. Meta-regression analysis addresses the rising "Tower of Babel" that current economics and business research has become. Meta-analysis is the statistical analysis of previously published, or reported, research findings on a given hypothesis, empirical effect, phenomenon, or policy intervention. It is a systematic review of all the relevant scientific knowledge on a specific subject and is an essential part of the evidence-based practice movement in medicine, education and the social sciences. However, research in economics and business is often fundamentally different from what is found in the sciences and thereby requires different methods for its synthesis-meta-regression analysis. This book develops, summarizes, and applies these meta-analytic methods. © T.D. Stanley and Hristos Doucouliagos 2012. All rights reserved.
This paper develops a meta-analysis of the empirical literature that estimates the effect of inequality on growth. It covers studies published in scientific journals during 1994-2014 that examine the impact on growth of inequality in income, land, and human capital distribution. We find traces of publication bias in this literature, as authors and journals are more willing to report and publish statistically significant findings, and the results tend to follow a predictable time pattern over time according to which negative and positive effects are cyclically reported. After correcting for these two forms of publication bias, we conclude that the high degree of heterogeneity of the reported effect sizes is explained by study conditions, namely the structure of the data, the type of countries included in the sample, the inclusion of regional dummies, the concept of inequality and the definition of income. In particular, our meta-regression analysis suggests that: cross-section studies systematically report a stronger negative impact than panel data studies; the effect of inequality on growth is negative and more pronounced in less developed countries than in rich countries; the inclusion of regional dummies in the growth regression of the primary studies considerably weakens such effect; expenditure and gross income inequality tend to lead to different estimates of the effect size; land and human inequality are more pernicious to subsequent growth than income inequality is. We also find that the estimation technique, the quality of data on income distribution, and the specification of the growth regression do not significantly influence the estimation of the effect sizes. These results provide new insights into the nature of the inequality-growth relationship and offer important guidelines for policy makers.
IntroductionIndividual studiesThe summary effectHeterogeneity of effect sizesSummary points
I use U.S. manufacturing industry data to estimate a system of three equations implied by a model of R&D-induced growth in steady state. These equations relate R&D intensity to patenting, patenting to technological progress, and technological progress to economic growth. In each case, I find evidence of positive impact. Thus, I reject the null hypothesis that growth is not induced by R&D in favour of the Schumpeterian endogenous growth framework without scale effects. I also find strong support for technological spillovers from aggregate research intensity to industry-level innovation success. JEL Classification: O40, O30
R&D, innovation, et progrès technologique: un test du cadre schumpétérien en l’absenced’effets d’échelle. L’auteur utilise des données de l’industrie manufacturière pour calibrer un système de trois équations émergeant d’un modèle de croissance en régime permanent induite par le R&D. Ces équations relient l’intensité de R&D à l’obtention de brevets, l’obtention de brevets au progrès technologique, et le progrès technologique à la croissance économique. Dans chaque cas, on trouve un impact positif. En conséquence, l’auteur rejette l’hypothèse nulle que la croissance n’est pas engendrée par le R&D en faveur de l’hypothèse de croissance endogène à la Schumpeter sans effets d’échelle. L’auteur confirme fortement l’hypothèse d’effets de retombées technologiques sur le succès de l’innovation au niveau de l’industrie en conséquence d’une forte intensité de recherche.
Using US manufacturing industry data, we re-examine evidence of first- and second-generation models of R&D-based endogenous growth focusing on innovation (patent) quality. We show that Schumpeterian growth theories perform better than semi-endogenous growth models.
Recent medical research shows that health is highly influential for learning and the ability to think laterally; however, past economic studies have failed to empirically examine the influence of health on learning, schooling, and ideas production; the main drivers of growth in endogenous growth models. This paper constructs a measure of health-adjusted educational attainment among the working age population based on their health status during the time they did their education. Using annual data for 21 OECD countries over the past two centuries it is shown that health has been highly influential for the quantity and quality of schooling, innovations and growth.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
In this article we devise an endogenous growth model with R&D, physical capital, and human capital with several externalities and use it to quantitatively evaluate the effect on growth and welfare of implementing
different budget-neutral policies. The welfare effects of different policies are calculated by taking into account the transitional dynamics of the economy after the policy reform. Our main findings have policy implications; mainly, subsidies to research are the most welfare-increasing amongst the budget neutral policies, and the optimal structure of subsidies entails substantially increasing the subsidy to R&D, maintaining a zero subsidy to production, and reducing the subsidy to education, so as to keep the intertemporal government budget balanced. A detailed sensitivity analysis shows the robustness of these results.
In this article we estimate the dynamic relationship between employment in R&D and generation of knowledge as measured by patent applications across OECD countries. In several recently developed models, known as ‘idea-based’ models of growth, the ‘idea-generating’ process is the engine of productivity growth. Moreover, in real business cycle models technological shocks are an important source of fluctuations. Our empirical strategy is able to test whether knowledge spillovers are strong enough to generate sustained endogenous growth and to estimate the quantitative impact of international knowledge on technological innovation of a country in the short and in the long run.
This paper analyses the spatial patterns of innovation, its regional interdependencies and evolution, as well as its role in determining local innovation in Spanish regions. Results indicate the suitability of a trade-based regional proximity when considering spatial spillovers in innovation. In this context, not only local capacity is relevant in determining domestic innovation, but also spatial innovation spillovers, which result mainly from efforts in both higher education and public administration. Moreover, a minimum level of regional development is required to improve the effectiveness of R&D policies. Therefore, it is necessary for R&D policies to act in combination with other policies focused on the improvement of socio-economic and structural determinants of regional innovative performance.
Over the final two decades of the 20th century, a number of formerly industrializing economies and historical imitator countries achieved levels of innovative capacity commensurate with or greater than those of some economies that were historically more innovative. We investigate the factors that enabled such emerging innovator economies to achieve successful catch-up while some historically more innovative countries experienced relative declines in innovative productivity. We focus our analysis on the estimation of a production function for innovations at the world's technical frontier. Based on the results of this analysis, we classify countries into categories reflecting their historical levels of innovative capacities and develop counterfactual indices that identify the factors that correspond to long-run improvements in innovative roductivity. These exercises suggest that the development of innovation-enhancing policies and infrastructures are necessary for achieving innovative leadership, but that these are insufficient unless coupled with ever-increasing financial and human capital investments in innovation.
This paper assesses whether the most important R&D technologies at the roots of second-generation Schumpeterian growth theories are consistent with patenting and innovation statistics. Using US manufacturing industry data, we estimate various systems of simultaneous equations modeling the innovation functions underlying growth frameworks based on variety expansion, diminishing technological opportunities and rent protection activities. Our evidence indicates that innovation functions characterized by the increasing difficulty of R&D activity fit US data better. This finding relaunches the debate on the soundness of the new Schumpeterian strand of endogenous growth literature.
Growth in this model is driven by technological change that arises from intentional investment decisions made by profit-maximizing agents. The distinguishing feature of the technology as an input is that it is not a conventional good or a public good; it is a nonrival, partially excludable good. Because of the noconvexity introduced by a nonrival good, price-taking competition cannot be supported. Instead, the equilibrium is one with monopolistic competition. The main conclusions are that the stock of human capital determines the rate of growth, that too little human capital is devoted to research in equilibrium, that integration into world markets will increase growth rates, and that a large population is not sufficient to generate growth. Copyright 1990 by University of Chicago Press.
This paper argues that the 'scale effects' prediction of many recent R&D-based models of growth is inconsistent with the time-series evidence from industrialized economies. A modified version of the Romer model that is consistent with this evidence is proposed, but the extended model alters a key implication usually found in endogenous growth theory. Although growth in the extended model is generated endogenously through R&D, the long-run growth rate depends only on parameters that are usually taken to be exogenous, including the rate of population growth. Copyright 1995 by University of Chicago Press.
Abstract We examine the dynamics of ideas production and knowledge-productivity relationship in a panel of 19 OECD countries. A new data set of triadic patents is used. We rigorously address the issues of cross-country heterogeneity and endogeneity. Domestic and foreign ideas stocks exert positive but heterogeneous effects on ideas production. We find evidence of duplicate R&D but little support for endogenous growth. Countries with low domestic ideas bases could considerably improve productivity through ideas accumulation; however, this effect is modest for countries with sizeable ideas bases. An implication is that country-specific R&D policy appears potentially more effective than the one-size-fits-all approach.
On examine la dynamique de la production d'idées et la relation connaissance – productivité dans un panel de 19 pays de l'OCDE. On utilise une nouvelle base de données – les familles de brevets triadiques. On traite rigoureusement des problèmes d'hétérogénéité et d'endogénéité entre pays. Les stocks d'idées étrangères ou locales exercent un effet positif mais hétérogène sur la production d'idées. On observe de la duplication de R&D mais peu de support pour la croissance endogène. Les pays avec peu d'idées locales pourraient augmenter coinsidérablement leur productivité par l'accunulation d'idées; cependant cet effet est modeste pour les pays qui ont un stock de base d'idées qui est considérable. Une implication est qu'une politique de R&D spécifique au pays semble potentiellement plus efficace qu'une approche taille unique.
The extent of heterogeneity in a meta-analysis partly determines the difficulty in drawing overall conclusions. This extent may be measured by estimating a between-study variance, but interpretation is then specific to a particular treatment effect metric. A test for the existence of heterogeneity exists, but depends on the number of studies in the meta-analysis. We develop measures of the impact of heterogeneity on a meta-analysis, from mathematical criteria, that are independent of the number of studies and the treatment effect metric. We derive and propose three suitable statistics: H is the square root of the chi2 heterogeneity statistic divided by its degrees of freedom; R is the ratio of the standard error of the underlying mean from a random effects meta-analysis to the standard error of a fixed effect meta-analytic estimate, and I2 is a transformation of (H) that describes the proportion of total variation in study estimates that is due to heterogeneity. We discuss interpretation, interval estimates and other properties of these measures and examine them in five example data sets showing different amounts of heterogeneity. We conclude that H and I2, which can usually be calculated for published meta-analyses, are particularly useful summaries of the impact of heterogeneity. One or both should be presented in published meta-analyses in preference to the test for heterogeneity.
This paper estimates the parameters of the ideas' production function central to recent models of economic growth. We do so by evaluating the determinants of international' patenting rates across the OECD, where an international patent is one granted by the U.S. patent office to a foreign establishment. Taking advantage of variation in the flow of ideas produced by different countries over time, we provide evidence for three main findings. First, at the level of the production of international patents, country-level R&D productivity increases proportionally with the stock of ideas already discovered, a key parametric restriction associated with the Romer model of ideas-driven growth (Romer, 1990; Jones, 1995). Second, we find that ideas productivity in a given country is constant or declining in the worldwide stock of ideas. Ideas production by other countries raises the bar for producing new-to-the-world technology domestically, outweighing the positive effects of international knowledge spillovers. Finally, ideas productivity is concave in the size of the R&D workforce and the linkage between ideas production and overall productivity growth is small. These results suggest that while the parametric restrictions required to generate endogenous technological change may be satisfied for individual economies, the growth rate associated with such effects may be modest. There seems to be a gap between the the sustained production of ideas by advanced economies and the ability to translate ideas into measured productivity growth.
This review considers several meta-regression and graphical methods that can differentiate genuine empirical effect from publication bias. Publication selection exists when editors, reviewers, or researchers have a preference for statistically significant results. Because all areas of empirical research are susceptible to publication selection, any average or tally of significant/insignificant studies is likely to be biased and potentially misleading. Meta-regression analysis can see through the murk of random sampling error and selected misspecification bias to identify the underlying statistical structures that characterize genuine empirical effect. Meta-significance testing and precision-effect testing "PET" are offered as a means to identify empirical effect beyond publication bias and are applied to four areas of empirical economics research - minimum wage effects, union-productivity effects, price  elasticities, and tests of the natural rate hypothesis. Copyright Blackwell Publishers Ltd, 2005.
This paper provides a survey on studies that analyze the macroeconomic effects of intellectual property rights (IPR). The first part of this paper introduces different patent policy instruments and reviews their effects on R&D and economic growth. This part also discusses the distortionary effects and distributional consequences of IPR protection as well as empirical evidence on the effects of patent rights. Then, the second part considers the international aspects of IPR protection. In summary, this paper draws the following conclusions from the literature. Firstly, different patent policy instruments have different effects on R&D and growth. Secondly, there is empirical evidence supporting a positive relationship between IPR protection and innovation, but the evidence is stronger for developed countries than for developing countries. Thirdly, the optimal level of IPR protection should tradeoff the social benefits of enhanced innovation against the social costs of multiple distortions and income inequality. Finally, in an open economy, achieving the globally optimal level of protection requires an international coordination (rather than the harmonization) of IPR protection.
Regional economic growth in Portugal has mainly been studied from the perspective of convergence with data ending by the early 2000’s. The country as a whole has stopped converging to the output levels of the richest European countries by this period and has also become one of the most unequal EU member-states in terms of income distribution in the meantime. It is thus important to analyze the growth performance at the regional level in a more recent period, 1995-2007, emphasizing regional disparities in inequality as explanatory factors. This study examines the relationship between inequality and regional growth in Portugal at NUTS III level exploring the explanatory power of earnings and education inequality measures computed with data from the Quadros de Pessoal database. The results point to a positive relationship between initial inequality and regional growth, stronger for education than for earnings inequality, but with earnings inequality measures revealing a higher explanatory power. Moreover, there is evidence that it is inequality at the top of the distribution that is the relevant to explain regional growth, a result that reinforces the higher propensities to save of the richer and the incentives mechanisms of transmission from inequality to growth. Additionally, the evidence does not support the existence of convergence among Portuguese NUTS III regions during the period under analysis. These findings are robust to the introduction of most additional control variables and the consideration of alternative measures of earnings and education inequality.
The impact of institutions on economic performance has attracted significant attention from researchers, as well as from policy reformers. A rapidly growing area in this literature is the impact of economic freedom on economic growth. The aim of this paper was to explore publication bias in this literature by means of traditional funnel plots, meta-significance testing, as well as by bootstrapping these meta-significance tests. When all the available estimates are combined and averaged, there seems to be evidence of a genuine and positive economic freedom - economic growth effect. However, it is also shown that the economic freedom - economic growth literature is tainted strongly with publication bias. The existence of publication bias makes it difficult to identify the magnitude of the genuine effect of economic freedom on economic growth. The paper explores the differences between aggregate and disaggregate measures of economic freedom and shows that selection effects are stronger when aggregate measures are used. Copyright Blackwell Publishers Ltd, 2005.
A model of endogenous growth is developed in which growth is driven by vertical innovations that involve creative destruction. Equilibrium is determined by a forward-looking difference equation, according to which the amount of research in any period depends negatively upon the amount expected next period. The paper analyzes positive and normative properties of stationary equilibria, and shows conditions for the existence of cyclical equilibria and no-growth traps. The growth rate may be more or less than optimal because a business-stealing effect counteracts the usual spillover and appropriability effects. In addition, innovations tend to be too small. Copyright 1992 by The Econometric Society.
The aggregate rate of R&D in a competitive economy is compared with the optimal rate. The optimal rate of R&D is shown to
be the same for all preferences in a broad family, while the competitive rate is sensitive to the form of substitutability
among products and so can vary dramatically within a family. The second-best level of R&D is shown to be also common within
a family and equal to the optimal rate. Numerical examples suggest that diminishing returns in the innovation technology is
the most important potential source for excessive R&D in a competitive economy.
No More Stepping on Toes. A Challenge for World Intellectual Property Day
- O Abello
Can Second-Generation Endogenous Growth Models Explain the Productivity Trends and Knowledge Production in the Asian Miracles Economies?
- J B Ang
- J B Madsen
Quantifying Heterogeneity in a Meta-analysis
- J P T Higgins
- S Thompson
Assessment of Regression-based Methods to Adjust for Publication Bias through a Comprehensive Simulation Study
- S G Moreno
- A J Sutton
- A Ades
- T D Stanley
- K R Abrams
- J L Peters
- N J Cooper