Lederman, DanielMaloney, William F.2014-05-122014-05-122003-04https://hdl.handle.net/10986/18254Lederman and Maloney trace the evolution of research and development (R&D) expenditures along the development process using a new global panel data set. They show that R&D effort measured as a share of GDP rises with development at an increasing rate. The authors examine how four groups of countries from Latin America, Asia, advanced manufacturing exporters, and advanced natural resource-abundant countries fare relative to the predicted development trajectory. Latin America generally underperforms as do some countries in Asia and Europe, but their striking finding is that some-Finland, Israel, the Republic of Korea, and Taiwan (China)-have radically deviated from the predicted trajectory and displayed impressive R&D takeoffs. The authors ask whether these countries overinvest in R&D but find that the high estimates of the social rates of return probably justify this effort. Moreover, the returns to R&D decline with per capita GDP. The authors attempt to explain why rich countries invest more in R&D than poor countries. They conclude that financial depth, protection of intellectual property rights, government capacity to mobilize resources, and the quality of research institutions are the main reasons why R&D efforts rise with the level of development.en-USCC BY 3.0 IGORESEARCH & DEVELOPMENTEXPENDITURE ANALYSISEXPORTSINTELLECTUAL PROPERTY RIGHTSGOVERNMENT DECISION-MAKINGRESEARCH ORGANIZATIONSFACTOR PRODUCTIVITYTECHNOLOGY DEVELOPMENTECONOMIC DEVELOPMENTBASIC RESEARCHINNOVATIONSDEVELOPING COUNTRIESRATES OF RETURNPRODUCTIVITY GROWTH ACCELERATORAGRICULTUREBASIC RESEARCHBASIC SCIENCEBENCHMARKINGCAPITAL MARKETSCOMPETITIVENESSCPICROWDING OUTECONOMETRICSECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC RISKEDUCATIONAL ATTAINMENTELASTICITIESELASTICITYEMPLOYMENTENDOGENOUS VARIABLESEQUILIBRIUMESTIMATORSEXPECTED RETURNSEXPLOITATIONEXPLORATIONFISHINGFOREIGN R&DFUTURE RESEARCHGDPGDP PER CAPITAGROWTH MODELSINCOME LEVELSINTELLECTUAL PROPERTYINTELLECTUAL PROPERTY RIGHTSINTEREST RATESLABOR FORCELABOR PRODUCTIVITYLEVEL OF INCOMELEVELS OF INCOMEMARGINAL PRODUCTMARKET POWERNATIONAL INNOVATIVE CAPACITYNATURAL RESOURCESNET EXPORTSOILOPPORTUNITY COSTOPPORTUNITY COSTSPATENT PROTECTIONPER CAPITA INCOMEPOSITIVE EFFECTSPRIVATE R&DPRIVATE SECTORPRODUCTION FUNCTIONPRODUCTIVITY GROWTHPROPERTY RIGHTSPROTECTION OF INTELLECTUAL PROPERTY RIGHTSPUBLIC R&DPUBLIC RESEARCHR&DR&D EFFICIENCYR&D EXPENDITURESR&D PROJECTSR&D SPENDINGRANDOM WALKRATES OF RETURNREAL INTEREST RATEREGRESSION ANALYSISRESEARCH CAPACITYRESEARCH CENTERSRESEARCH EXPENDITURESRESEARCH INSTITUTIONSRESEARCH POLICYRESEARCH WORKING PAPERSRETAINED EARNINGSSAVINGSSOIL RESEARCHSTATISTICAL DATASUCCESSFUL COUNTRIESSURVEY DATATECHNIQUESTECHNOLOGICAL CHANGETECHNOLOGICAL FRONTIERTECHNOLOGICAL INNOVATIONTECHNOLOGICAL PROGRESSTECHNOLOGY INDICATORSTERTIARY EDUCATIONTIME SERIESTOTAL FACTOR PRODUCTIVITYVALIDITYRESEARCH AND DEVELOPMENT10.1596/1813-9450-3024