The impact of knowledge capital on regional total factor productivity

LeSage, James P. and Fischer, Manfred M. ORCID: (2009) The impact of knowledge capital on regional total factor productivity. WU Vienna University of Economics and Business, Vienna.


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This paper explores the contribution of knowledge capital to total factor productivity differences among regions within a regression framework. The dependent variable is total factor productivity, defined as output (in terms of gross value added) per unit of labour and physical capital combined, while the explanatory variable is a patent stock measure of regional knowledge endowments. We provide an econometric derivation of the relationship, which in the presence of unobservable knowledge capital leads to a spatial regression model relationship. This model form is extended to account for technological dependence between regions, which allows us to quantify disembodied knowledge spillover impacts arising from both spatial and technological proximity. A six-year panel of 198 NUTS-2 regions spanning the period from 1997 to 2002 was used to empirically test the model, to measure both direct and indirect effects of knowledge capital on regional total factor productivity, and to assess the relative importance of knowledge spillovers from spatial versus technological proximity.

Item Type: Paper
Keywords: total factor productivity / knowledge spillovers / technological proximity / spatial Durbin model / European regions
Classification Codes: JEL C11, C21, O47, O52, R11
Divisions: Departments > Sozioökonomie > Wirtschaftsgeographie und Geoinformatik > Fischer
Depositing User: ePub Administrator
Date Deposited: 10 Jul 2014 07:20
Last Modified: 04 Nov 2019 14:29


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