Different Impacts of Scientific and Technological Knowledge on Economic Growth: Contrasting Science and Technology Policy in East Asia and Latin America

Abstract

This paper conducts country‐panel econometric analysis with a focus on the different roles of scientific and technological knowledge on economic growth and on the knowledge production functions. It finds that it is not scientific knowledge (academic articles) but technological knowledge (patents) that matters for economic growth, and that generating scientific knowledge does not automatically lead to the generation of technological knowledge. We find that technological knowledge is primarily determined by corporate research and development efforts, which used to be more lacking in Latin American countries, compared with East Asia. This finding sheds new light on the question of why Latin American and East Asian countries have shown such divergent economic performances.