The industrial linkages and supply effects of the U.S. R & D sector: Comparison with OECD countries

The industrial linkages and supply effects of the U.S. Research and Development (R & D) sector are examined using the input-output approach. Although the U.S. has the highest R & D intensity among major OECD countries, the U.S. R & D sector has relatively low backward and forward linkages to other industrial sectors. Moreover, the supply investment effect of the U.S. R & D sector is the least, showing that the sector is not likely to stimulate the production of the other sectors. The supply shortage effect of the U.S. R & D sector is also the least among the countries. The findings in this study imply that improving the linkages and supply effects of the R & D sector may be more important than increasing only the amount of R & D expenditure in the U.S.