Boosting Manufacturing Productivity through R&D: International Comparisons with Special Focus on Italy

Alessandro Sterlacchini, Polytechnic University of Marche
Francesco Venturini, Polytechnic University of Marche

Abstract

Using data for twelve manufacturing industries of five developed countries over the period 1980- 2002, we perform a dynamic panel estimation – based on a ECM model - of the long-run elasticity of TFP with respect to the stock of R&D capital. The highest elasticity is found for the US (0.51) while lower values arise for Germany (0.29), France (0.23) and Spain (0.22); the latter, in turn, are higher than that estimated for Italy (0.14). The unsatisfactory performance of Italian manufacturing industries is confirmed by further analyses in which a better measurement of TFP is provided and the time period extended. The above findings and their policy implications are discussed firstly in the light of the US-EU divide in terms of R&D-induced productivity growth and, subsequently, by focussing on the Italian case.