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Abstract

New growth theories underscore the significance of research and development (R&D) as a
catalyst for long-term economic growth, making investment in R&D a crucial component
of macroeconomic planning for nations. This study examined the effects of R&D
expenditures on the economic growth of G8 countries spanning from 1999 to 2019,
employing pooled, fixed-effect, and random-effect panel models. Various tests, including
Chow, Breusch-Pagan, Hausman, Wooldridge, Pasaran, and White tests, are conducted to
select the final model and assess its reliability. Findings reveal a significant positive impact
of R&D expenditures on the economic growth of G8 countries, with a one percent increase
in R&D spending associated with a 0.523% rise in economic growth. Overall, the model is
deemed acceptable, explaining 91.6% of variations in the economic growth of G8 countries.

Keywords

R&D Economic Growth G8 countries Panel data Regression Fixed effects

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fariady, W., & Aman, A. (2025). Empirical Analysis of Research and Development Expenditures on Economic Growth: A Case Study of G8 Countries. Journal of Social Sciences - Kabul University, 6(4), 69–95. https://doi.org/10.62810/jss.v6i4.117
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