Discussion Papers 300, 19 S.
Jürgen Bitzer, Andreas Stephan
get_appDownload (PDF 179 KB)
Published in: Applied Economics (2007), 153-167
A new method for constructing R&D capital stocks is proposed. Following Schumpeter, the development of R&D capital stocks is modelled as a process of creative destruction. Newly generated knowledge is assumed not only to add to the existing R&D capital stocks but also, by displacing old knowledge, to destroy part of that capital. This is in stark contrast to the perpetual inventory method, which postulates a constant rate of depreciation. We compare both methods by estimating the impact of R&D and spillovers on output in OECD countries, and find that the new approach leads to more sensible and robust results.
Keywords: R&D capital stocks, knowledge spillovers, creative destruction
Frei zugängliche Version: (econstor)