IMPACT OF PUBLIC R&D EXPENDITURE ON ECONOMIC GROWTH IN SELECTED EU COUNTRIES

The aim of the paper is to investigate influence of research and development (R&D) expenditure on economic growth in 20 selected EU member states in the period 1995-2013, time span is also divided into a pre-crisis and a post-crisis period. Basic source of data is Eurostat database. The research is based on a dynamic panel regression model (GMM) and estimations are based on Arellan-Bond estimator (1991). Results confirm positive and statistically significant impact of government R&D expenditure, which is the main driver for economic growth during the analysed period. Importance and positive impact of higher education R&D expenditure increases in the post-crisis period. Contrary, business expenditure is found to be insignificant. Traditional growth variables (a higher share of qualified human resources and a higher intensity of investment) report positive effect, although investment only partly.