Post-Communist Firms’ Independent Green R&D and Productivity Growth under the Influence of Globalization

This paper empirically studies the influence of firms’ independent research and development on productivity. It considers two R&D behaviors of firms: independent innovation and dependent imitation. We acquire data from 28 post-communist economies between 2017 and 2019, and innovatively create indices to evaluate how likely firms were to independently perform green R&D that enhance their environmental friendliness. We also estimate firms’ productivity with a semiparametric method. Overall, independent green R&D does not significantly affect productivity. However, further analysis that considers the firms’ globalization statuses reveals interesting and robust findings. Among firms that are actively involved in the global market, a higher R&D independence does not promote productivity. Firms producing only domestically, however, expect a positive influence of R&D independence on their productivity. This finding remains robust under alternative analyses regarding general R&D too. Other factors such as energy efficiency, labor input, relationships with the government, and informal market competition also significantly affect productivity. Interpretations of findings and policy implications are provided