Upstream Product Market Regulations, ICT, R&D and Productivity

Our study investigates the importance of two main channels through which upstream anti‐competitive sector regulations impact productivity growth: investments in R&D and in ICT, as opposed to alternative channels we cannot explicitly consider for lack of appropriate data such as improvements in s...

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Bibliographic Details
Published in:The Review of income and wealth 2017-02, Vol.63 (s1), p.S68-S89
Main Authors: Cette, Gilbert, Lopez, Jimmy, Mairesse, Jacques
Format: Article
Language:English
Subjects:
C50
growth
ICT
O43
productivity
R&D
regulations
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Summary:Our study investigates the importance of two main channels through which upstream anti‐competitive sector regulations impact productivity growth: investments in R&D and in ICT, as opposed to alternative channels we cannot explicitly consider for lack of appropriate data such as improvements in skills, management and organization. We specify a three equations model: an extended production function relating total factor productivity to both R&D and ICT capital, and to upstream regulations, and two factor demand functions relating R&D and ICT capital to upstream regulations. We estimate these relations on an unbalanced panel of 15 OECD countries and 13 industries over the period 1987–2007. We find that the total impact of upstream regulations on total factor productivity is sizeable, a large part of which is transmitted through investments in R&D and ICT, mainly the former.
ISSN:0034-6586
1475-4991
DOI:10.1111/roiw.12252