Growth: Scale or market-size effects?

摘要

Is the supply of researchers or the demand for technologies more important for innovation? The supply of research labor captures a scale effect, whereas the demand from production labor for technologies captures a market-size effect. We find that both the scale effect and the market-size effect are important for innovation and their relative importance depends on R&D labor intensity. We collect data on R&D labor intensity and find that it varies significantly across countries. (C) 2019 Elsevier B.V. All rights reserved.