2016
DOI: 10.1111/jors.12279
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Regional Growth, Innovation, and Latent Nonlinear Effects

Abstract: This paper studies the link between knowledge, innovation, and growth in European regions using nonparametric methods. Our findings suggest that knowledge inputs and the share of innovative firms have a heterogeneous and nonlinear relationship with growth. This evidence has been exploited to examine the consequences of alternative policies using a counterfactual estimation setup, the results of which imply that increasing the formal knowledge base may be optimal in most regions. Less knowledge and innovation i… Show more

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Cited by 8 publications
(11 citation statements)
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“…Parameters in Equation can be estimated with different alternatives (see Henderson & Parmeter, ). In particular, the methods introduced by Racine and Li () are becoming increasingly popular because of their attractive properties and, as a consequence, empirical applications in the field of economics have burgeoned in recent years (see Henderson et al, , ; Peiró‐Palomino, ; Sanso‐Navarro & Vera‐Cabello, ). Following these contributions, we use the local‐linear least squares (LLLS) estimator, based on ‘generalized product kernels’ and providing optimal estimates for mixed data sets with both continuous and categorical variables.…”
Section: Methodological Notesmentioning
confidence: 99%
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“…Parameters in Equation can be estimated with different alternatives (see Henderson & Parmeter, ). In particular, the methods introduced by Racine and Li () are becoming increasingly popular because of their attractive properties and, as a consequence, empirical applications in the field of economics have burgeoned in recent years (see Henderson et al, , ; Peiró‐Palomino, ; Sanso‐Navarro & Vera‐Cabello, ). Following these contributions, we use the local‐linear least squares (LLLS) estimator, based on ‘generalized product kernels’ and providing optimal estimates for mixed data sets with both continuous and categorical variables.…”
Section: Methodological Notesmentioning
confidence: 99%
“…In this regard, recent evidence for the EU regions suggests that there are good reasons to rely on more flexible models able to deal with parameter heterogeneity. Peiró‐Palomino () found nonlinear and heterogeneous effects for associations on regional growth, while Sanso‐Navarro and Vera‐Cabello () found analogous results for the case of innovation and growth. Similarly, we might expect regional effects of associations on innovation to differ.…”
Section: Introductionmentioning
confidence: 92%
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“…What is interesting is that Capello and Lenzi [5] reveal that regions with a high level of human potential development can gain additional TFP gains from innovation. The complementary relationship between innovation and human capital capabilities is also advocated by Sanso-Navarro and Vera-Cabello [55] who study nonlinearities in regional growth.…”
Section: Resultsmentioning
confidence: 96%
“…Sustainability 2020, 12, 1808 10 of 14 human capital capabilities is also advocated by Sanso-Navarro and Vera-Cabello [55] who study nonlinearities in regional growth. Application of the fixed-effect model means that significant specific factors influencing TFP for regions are not included in the model.…”
Section: Resultsmentioning
confidence: 99%