Economic Reflections of Technological Transformation: Sectoral Structure of R&D Expenditures in Türkiye and Their Relationship with Productivity
Economic Reflections of Technological Transformation
DOI:
https://doi.org/10.5281/zenodo.18078185Keywords:
R&D, Total Factor Productivity, Sectoral Innovation, Türkiye, Principal Component Analysis, Cointegration AnalysisAbstract
Purpose – This study examines the effects of sectoral composition of Research and Development (R&D) expenditures on Total Factor Productivity (TFP) in Türkiye during 1990-2019. The research investigates how R&D expenditures by private sector, public sector, and higher education institutions differentially impact TFP, addressing a critical gap in the literature on developing economies where empirical evidence on sectoral R&D impacts remains limited.
Design/data/methodology – The study employs time-series data covering 1990-2019. Sophisticated techniques including unit root tests (ADF, Phillips-Perron, KPSS), Johansen Cointegration Analysis, Vector Error Correction Model (VECM), and Principal Component Analysis (PCA) are applied. The dataset includes TFP measurements and various macroeconomic, institutional, and R&D expenditure variables from Turkish Statistical Institute, Penn World Table, World Bank, and OECD databases.
Findings – Contrary to conventional expectations, the findings reveal an unexpected negative and statistically significant relationship (-0.0073) between private sector R&D expenditures and TFP. Public sector R&D (0.0112) and higher education R&D (0.0108) demonstrate positive effects on productivity. The capital intensity factor shows the strongest positive effect on TFP (0.0938), suggesting productivity gains in Türkiye primarily stem from capital accumulation rather than innovation-driven growth.
Originality/value – This study contributes to the literature by providing empirical evidence on the differential impacts of sectoral R&D expenditures on productivity in Türkiye, challenging conventional assumptions about private sector R&D effectiveness.
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