R&D and productivity in the spanish´s manufacturing firms

ABSTRACT The Spanish R&D to GDP ratio is low compared to other leading economies during the last decade.  This paper uses data of a sample of Spanish manufacturing firms over the period 1990-2001 to investigate the relationship between labour productivity and R&D capital at firm level.  A Cobb-Douglas function including R&D intensity is estimating using the panel data with instrumental variables method.   The results indicate that a positive and significant role for the firm's own R&D capital is only found in firms located in  technology intensive sectors.  It also appears that some firm's characteristics (firm size and the integration of the firm in a corporate group) play a significant role in influencing private output