R&D and Productivity in Danish Firms: Some Empirical Evidence.

The aim of the paper is to examine the relationship between R&D capital and productivity using micro data for Danish manufacturing firms. We account for the influence of factors such as ownership, innovative characteristics and source of funding. The return to accumulated R&D capital is estimated to be in the neighbourhood of 9-12 per cent, whereas the short-run effect of R&D is insignificant. Furthermore, we analyse the direct influence from foreign ownership, source of funding, innovative characteristics and ownership dispersion on productivity. However, none of the factors seem to have an impact on firm productivity. The same is the case for the indirect influence coming from interaction with accumulated R&D capital.