The Impact of Internal R&D and Technology Imports on Iranian Manufacturing Industrie's Output

Generally, developing countries are not able to invest enough on R&D; therefore, they try to get benefit from knowledge spillover, as an external R&D. This paper tries to investigate the impact of R&D expenditures and imported intermediate goods, as a proxy for technology imports, on value added of Iranian industries. To that end, we use a panel data set of Iranian two-digit ISIC manufacturing industries, over the period 1995-2006. The results show that both internal R&D and technology imports have a positive and significant effect; and that the technology imports has a larger effect. Any attempt by the government to promote internal R&D and interaction with the rest of the world is recommended.