Further considerations on the link between adjustment costs and the productivity of R&D investment: evidence for Spain

  1. Desiderio Romero-Jordán 1
  2. José Félix Sanz-Sanz 2
  3. Inmaculada Álvarez-Ayuso 3
  1. 1 Universidad Rey Juan Carlos
    info

    Universidad Rey Juan Carlos

    Madrid, España

    ROR https://ror.org/01v5cv687

  2. 2 Universidad Complutense de Madrid
    info

    Universidad Complutense de Madrid

    Madrid, España

    ROR 02p0gd045

  3. 3 Universidad Autónoma de Madrid
    info

    Universidad Autónoma de Madrid

    Madrid, España

    ROR https://ror.org/01cby8j38

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Revue:
Notas técnicas: [continuación de Documentos de Trabajo FUNCAS]

ISSN: 1988-8767

Année de publication: 2006

Número: 291

Type: Working Paper

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D'autres publications dans: Notas técnicas: [continuación de Documentos de Trabajo FUNCAS]

Résumé

This paper constructs a dynamic model to estimate the impact of adjustment costs on the productivity of investment in R&D. In order to take into account the possible endogeneity of adjustment costs, the model is estimated by means of Instrumental Variables (IV), using a panel of Spanish companies. The results show that the elasticity of the productivity of R&D investment with regard to adjustment costs is high, with a value close to 1 (-0.96). This confirms that it is essential to include adjustment costs in the empirical analysis of R&D productivity, as suggested by Jones and Williams (1998) and Comin (2003, 2004).

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