Research and development- relationship of economic growth: Application on selected OECD countries

ABSTRACTRESEARCH AND DEVELOPMENT- RELATIONSHIP OF ECONOMICGROWTH: APPLICATION ON SELECTED OECD COUNTRIESMurad TIRYAKIOGLUDepartment of EconomicsAfyon Kocatepe University Instute of Social SciencesJune 2006Advisor: Associate Prof. Selcuk AKCAYNations? main goal is to provide economical growth in a sustainable manner. For thisgoal it is requisite to have the dynamics of economic growth and to develop these dynamicsusing them in a proper way. On the other hand the main factor is technology that enableproduction factors operate efficiently and reflect to the production process. Development oftechnology is only possible with research-development (R&D) activities. Increasing of R&Dexpenditure give rise to technology, in the production process, getting stronger and moreproductive. Increasing productivity reflects in economy as increasing gross domestic product(GDP). Moving this point this study analyzes realtionship between R&D expenditures andeconomic growth of chosen OECD members in the frame of ?causality analysis? since 1970s.The technology, one of the dynamics of economic growth, is discussed on the basis of newinternal growth models that accept technology as the engine of economic growth. This study,involves an analysis examining whether economic growth depends upon R&D expendituresboth in the short and long run for chosen OECD countries, emphasizes the importance oftechnology for economic growth. Findings obtained from study demonstrate that there existscausality relationship between R&D expenditures and economic growth.