The Interaction Among R&D Expenses and Economic Growth Evidence From EU Transition Economies

The Interaction Among R&D Expenses and Economic Growth Evidence From EU Transition Economies

Omer Faruk Ozturk, Mahmut Unsal Sasmaz
Copyright: © 2022 |Pages: 11
DOI: 10.4018/978-1-7998-9648-7.ch007
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Abstract

The research and development (R&D) activities are some of the crucial factors affecting the economic growth through raising the technological development, resource base enlargement, and promotion in the capability of resource utilization. This study analyzed the mutual interplay between R&D investments and economic growth in a sample of the EU transition states by means of causality test. The consequences of causality analysis pointed out a unidirectional causality from R&D expenditures to economic growth in Slovenia and a unidirectional causality from economic growth to R&D expenditures at panel level and in Bulgaria, Croatia, Estonia, and Slovakia.
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Literature Review

The interaction among R&D expenses and economic growth has been extensively explored in the related empirical literature as seen in Table 1 and the researchers have generally explored the aforementioned relationship in sample of high-income countries and reached a positive effect of R&D expenditures on economic growth.

Key Terms in this Chapter

R&D Expenditures (R&D): Gross domestic expenditures on R&D (R&D) consisting of basic research, applied research, and experimental development and include capital and current expenditures in the sectors of business enterprise, government, higher education and private non-profit ( World Bank, 2021b ).

Real GDP per Capita Growth: Annual percentage growth rate of GDP per capita based on constant local currency ( World Bank, 2021a ).

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