Publication detail

Research & Development and Long-Term Economic Growth: A Bayesian Model Averaging Analysis

Author(s): prof. Roman Horváth Ph.D.,
Type: IES Working Papers
Year: 2011
Number: 19
ISSN / ISBN:
Published in: IES Working Papers 19/2011
Publishing place: Prague
Keywords: research and development, economic growth, Bayesian model averaging
JEL codes: O30, O32, O10.
Suggested Citation: Horváth, R. (2011). “Research & Development and Long-Term Economic Growth: A Bayesian Model Averaging Analysis” IES Working Paper 19/2011. IES FSV. Charles University.
Grants: 402/09/0965: New Approaches for monitoring and prediction of capital markets
Abstract: We examine the effect of research and development (R&D) on long-term economic growth using the Bayesian model averaging (BMA) to deal rigorously with model uncertainty. Previous empirical studies investigated the effect of dozens of regressors on long-term growth, but they did not examine the effect of R&D due to data unavailability. We extend these studies by proposing to capture the R&D intensity by the number of Nobel prizes in science. Using our indicator, our estimates show that R&D exerts a positive effect on long-term growth with posterior inclusion probability of 0.25 using our preferred parameter and model priors.
Downloadable: WP 2011_19_Horvath

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