Does research output cause economic growth or vice versa? Evidence from 34 OECD countries

The causal relation between research and economic growth is of particular importance for political support of science and technology as well as for academic purposes. This paper revisits the causal relationship between research papers published and economic growth in OECD countries for the period 1981-2011, using bootstrap panel causality analysis, which accounts for cross-section dependency and heterogeneity across countries. Our empirical results support unidirectional causality running from research output (in terms of total number of papers published) to economic growth for the US, Finland, Hungary, and Mexico; the opposite causality from economic growth to research papers published for Canada, France, Italy, New Zealand, UK, Austria, Israel, and Poland; and no causality for the rest of the countries. Our findings provide important policy implications for research policies and strategies for OECD countries. Introduction Past studies (King, 2004; Vinkler, 2008; Lee et al., 2011) examining the relationship between the growth of an economy measured by the country’s gross domestic product (GDP) and the country’s research output measured by scientometric indicators have concluded that