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Econometric Modelling of the Regional Knowledge Production Function in Europe

By Sylvie Charlot, Riccardo Crescenzi and Antonio Musolesi


By adopting a semiparametric approach, the 'traditional' regional knowledge production\ud function is developed in three complementary directions. First, the model is augmented\ud with region-specic time trends in order to account for endogeneity due to selection on unobservables\ud . Second, the nonparametric part of the model relaxes the standard assumptions\ud of linearity and additivity regarding the eect of R&D and human capital. Finally, the\ud assumption of homogeneity in the eects of R&D and human capital is also relaxed by ex-\ud plicitly accounting for the dierences between developed and lagging regions. The analysis\ud of the genesis of innovation in the regions of the European Union unveils nonlinearities and\ud threshold eects, complex interactions, and shadows eects that cannot be uncovered by\ud standard parametric formulations

Year: 2015
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