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R&D, International Trade and Creative Destruction—Empirical Findings from Finnish Manufacturing Industries*

  • Mika Maliranta
Original Article

Abstract

The determinants of productivity-enhancing micro-level restructuring are examined empirically with a panel of the twelve Finnish manufacturing industries. It is hypothesized that R&D leads to productivity diversity among plants, which in turn leads to the gradual reshuffling of input shares in the presence of dynamic competitive pressure. The effect of the “creative destruction” on industry productivity growth is measured with the between-component of productivity decomposition. Econometric results indicate with reasonable robustness that R&D generates creative destruction with a lag of several years. Some evidence is found that imports stimulate productivity-enhancing restructuring, especially when domestic R&D is low.

Keywords

R&D competition international trade productivity plant-level restructuring 

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Copyright information

© Springer Science + Business Media, Inc. 2005

Authors and Affiliations

  1. 1.The Research Institute of the Finnish Economy (ETLA)HelsinkiFinland

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