dc.contributor.author | IMPULLITI, Giammario | |
dc.date.accessioned | 2008-01-31T17:37:26Z | |
dc.date.available | 2008-01-31T17:37:26Z | |
dc.date.issued | 2008 | |
dc.identifier.issn | 1725-6704 | |
dc.identifier.uri | https://hdl.handle.net/1814/7926 | |
dc.description.abstract | The geographical distribution of R&D investment changes dramatically in the 1970s and 1980s.
In the early 1970s U.S. firms are the uncontested world leaders in R&D investment in most manufacturing
sectors. Later, led by Japan and Europe, foreign firms start challenging American R&D
leadership in many sectors of the economy. In this period of increasing competition we also observe
a substantial increase in the U.S. R&D subsidy. In a version of the multi-country quality ladder
growth model I study the effects of foreign R&D competition on domestic welfare and on the optimal
R&D subsidy. I build a new empirical index of international R&D rivalry that can be used
to perform quantitative analysis in this type of frameworks. In a calibrated version of the model
I focus on the period 1979-1991 and perform the following quantitative exercises: first, I evaluate
the quantitative effects of the observed increase in foreign R&D competition on U.S. welfare. I
find that the positive growth effect and the negative business-stealing effect of foreign competition
on U.S. welfare substantially balance each other, and the overall welfare effect of competition is
negligible - less then 1 percent of per-capita consumption. Moreover, using estimates of the effective
U.S. R&D subsidy rate, I compute the distance from optimality of the observed subsidy at each
level of competition. I find that international competition increases the optimal subsidy and that,
surprisingly, the U.S. subsidy observed in the data is fairly close to the optimal subsidy. | en |
dc.format.mimetype | application/pdf | |
dc.language.iso | en | en |
dc.publisher | European University Institute | |
dc.relation.ispartofseries | EUI ECO | en |
dc.relation.ispartofseries | 2008/11 | en |
dc.rights | info:eu-repo/semantics/openAccess | |
dc.subject | F12 | en |
dc.subject | F13 | en |
dc.subject | 038 | en |
dc.subject | O41 | en |
dc.subject | international competition | en |
dc.subject | R&D-driven growth theory | en |
dc.subject | strategic R&D policy | en |
dc.subject | international trade and growth | en |
dc.title | International Competition and U.S. R&D Subsidies: A Quantitative Welfare Analysis | en |
dc.type | Working Paper | en |
dc.neeo.contributor | IMPULLITI|Giammario|aut| | |
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