One of the important public policy issues in science and technology is to ascertain if and how firms' investments in research and development (R&D) contribute to technical progress at firm and industry levels. Griliches (1979) made a pioneering contribution to our understanding of economic...

There is policy interest in factoring productivity growth into technical progress and returns to scale components. Our approach uses exact index number methods to reduce the parameters that must be estimated, and allows us to exploit the cross-sectional dimension of plant-level panel data. We...