@article{iiasa14568,
           month = {May},
           title = {The impact of R\&D on factor-augmenting technical change - an empirical assessment at the sector level},
       publisher = {Taylor \& Francis},
            year = {2017},
           pages = {1--33},
             doi = {10.1080/09535314.2017.1316707},
         journal = {Economic Systems Research},
        keywords = {Factor-augmenting technical change, R\&D, CES function, GMM regression},
             url = {https://pure.iiasa.ac.at/id/eprint/14568/},
            issn = {0953-5314},
        abstract = {The aim of the paper is to quantify endogenous factor-augmenting technical change driven by R\&D investments in a panel of 11 OECD countries over 1987-2007. This paper contributes to the scant empirical evidence on the speed, sources and direction of technical change for various sectors and production factors. Assuming cost-minimization behavior, a CES framework is used to derive a system of equations that is estimated by a GMM system estimator. The estimated factor-augmenting technology parameters show that in most sectors, technical change was labor-augmenting and labor-saving. Statistically significant effects of manufacturing and services R\&D were found on factor-augmenting technical change (with the highest R\&D elasticities found in the high-tech manufacturing and transport, storage and communication sectors). Whereas 'in-house' R\&D stimulates total factor productivity, R\&D spilled over to other sectors has a capital-augmenting effect accompanied by a higher use of labor. The results of this study provide a starting point for incorporating endogenous factor-augmenting technical change in impact assessment models aimed at broad policy analysis including economic growth, food security or climate change.},
          author = {Smeets Kristkova, Z. and Gardebroek, C. and van Dijk, M. and van Meijl, H.}
}