R&D Spillovers and Firms’ Performance in Italy. Evidence from a Flexible Production Function

Using a translog production function we estimate the impact of R&D spillovers on the output performance of Italian manufacturing firms over the period 1998-2003. Technological flows aremeasured through an asymmetric similarity index that takes also into account the geographical proximity of firms.Results showthatR&D spillovers positively affect firms production and that geographymatters in determining the role of the external technology.Moreover, we find that the effect ofR&Dspillovers is high in the Centre-South of Italy and that the stock of R&D spillovers is Morishima complement to the stock of R&D own-capital.