Abstract:

Research & development expenditures, which are innovative and creative work, are evaluated as an substantial factor in productivity, competitiveness, and sustainable growth performance in developed countries. This study, is targeted to empirically analyze the impact of research & development expenditures on economic growth and unemployment in 25 selected countries from the years 1996-2020. Panel data analysis was carried out with methods that take into account the cross-section dependency. After testing the unit root of the variables in the econometric model, the Westerlund cointegration test was used to determine the long-run relationship. Afterward, short and long-term coefficients were determined with panel ARDL data methods. The empirical findings revealed that there is an interaction between research & development expenditures and economic growth in the short and long run. However, while a relation was determined between research & development expenditures and employment in the short run, no relationship was found between the two variables in the long term. Dumitrescu and Hurlin's causality analysis was performed to determine the causal relation and a causal link between research & development expenditures and economic growth and between research & development expenditures and employment was determined.

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