Embodied and disembodied international spillovers of R&D in OECD manufacturing industries

Abstract

This paper investigates the relationship between productivity changes and R&D in the presence of embodied and disembodied international spillovers of technology for total manufacturing industries in 14 OECD countries. The paper assumes that embodied spillovers of R&D are measured by trade and disembodied spillovers by technological distance. The Malmquist total factor productivity (TFP) change may be separated into two components: technical and efficiency changes. Our empirical results indicate that for 14 countries as a whole, both domestic R&D and disembodied spillovers of R&D have statistically significant and positive effects on TFP growth and especially on technical change. For high-R&D-intensive countries, the growth of TFP is mainly attributable to the increase in domestic R&D. For low-R&D-intensive countries, however, the international spillovers are the main factors for the TFP growth: technical innovation is attributable to disembodied international spillovers, and efficiency improvement to embodied spillovers. (C) 2003 Elsevier Ltd. All rights reserved.