R&D Strategy, Metropolitan Externalities and Productivity: Evidence from Sweden

Hans Loof, Börje Johansson

Research output: Contribution to journalArticlepeer-review

19 Citations (SciVal)


This paper studies the influence of metropolitan externalities on productivity for different types of long-run R&D engagement based on information from the Community Innovation Survey. We apply a dynamic general method of moments model to a panel of manufacturing and service firms with different locations in Sweden, classified as a metropolitan region, the largest metropolitan region, a metropolitan city, the largest metropolitan city and a nonmetropolitan area. This analysis generates three distinct results. First, the productivity premium associated with persistent R&D is close to 8 per cent in nonmetro locations and about 14 per cent in the largest city. Second, a firm without any R&D engagement does not benefit at all from the external milieu in metro areas. Third, no productivity premium is associated with occasional R&D effort regardless of the firm's location.
Original languageEnglish
Pages (from-to)141-154
JournalIndustry and Innovation
Issue number2
Publication statusPublished - 2014

Subject classification (UKÄ)

  • Social Sciences Interdisciplinary


  • innovation strategy
  • productivity
  • externalities
  • metropolitan
  • R&D


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