This paper provides an empirical analysis of the relationship between R&D intensity, rate of innovation and the growth rate of output in four manufacturing sectors from 17 OECD countries. The findings suggest that the knowledge stock is the main determinant of innovation in all four...

This study identifies the effect of technology shocks on aggregate output using confirmatory factor analysis employed by Griliches, Hall and Pakes (1991). The analysis is based on the assumptions that there are two distinct shocks in an economy, demand and technology shocks, and that the patent...