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

Research output: Contribution to journalArticle


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.


  • Hans Loof
  • Börje Johansson
Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Social Sciences Interdisciplinary


  • innovation strategy, productivity, externalities, metropolitan, R&D
Original languageEnglish
Pages (from-to)141-154
JournalIndustry and Innovation
Issue number2
Publication statusPublished - 2014
Publication categoryResearch