توسعه مالی، آزاد سازی و عمیق تر شدن فن آوری

This paper focuses on examining the effects of financial development and liberalization on knowledge accumulation. The results consistently show that while financial development facilitates the accumulation of new ideas, the implementation of financial reform policies is negatively associated with it. The undesirable effects of financial liberalization are found to operate through the triggering of crises and volatility in the financial system. There is also evidence supporting the hypothesis that financial liberalization reallocates talent from the innovative sector to the financial system, thus retarding technological deepening. Moreover, the findings also suggest that increased R&D activity and the presence of a stronger intellectual property rights protection framework tend to have beneficial effects on knowledge accumulation.

Following the seminal contributions of Romer (1990), Grossman and Helpman (1991) and Aghion and Howitt (1992), the economics of ideas and technology have become the central focus in the literature of economic growth in recent years. The generation of ideas is strongly related to the process of technological change since new ideas improve the technology of production. Moreover, fluctuations in innovative activity closely follow productivity patterns. Thus, a better understanding of what determines the creation of knowledge is important, given that changes in the rates of innovation may explain productivity accelerations and slowdowns (Jones, 2002 and Bottazzi and Peri, 2007). Recent contributions in the theoretical growth literature have emphasized the importance of finance and R&D efforts in explaining productivity growth. In the models developed by Blackburn and Hung (1998), Aghion et al. (2005) and Aghion and Howitt (2009), the relationship between finance and growth is analyzed in the context of innovation-based growth models. These models predict that financial market imperfections increase the costs of monitoring and thus encourage the hiding of successful inventions so that firms can avoid loan repayments. The removal of these restrictions encourages more ideas to be produced and patented, thus deepening the technological sector. Hence, a positive relationship between finance and innovative production is predicted.

Motivated by recent developments in the theories of endogenous growth that highlight the important role of finance in the process of technological deepening and the lack of any empirical evidence on this issue, this paper takes a first step in this direction by examining the effects of financial development and liberalization on the accumulation of ideas. Using data for 44 countries over the period 1973–2005, panel cointegration results show that there is a statistically robust relationship between knowledge accumulation, R&D input, patent law and finance. The results further indicate that while the accumulation of ideas is positively associated with R&D activity and protection of intellectual property, the effects of finance are mixed. Specifically, while financial development is found to have a beneficial effect on innovation in all countries, the effect of financial liberalization is found to be negative in developing countries. One of the main findings in this paper is that financial liberalization is associated with lower knowledge accumulation, contrary to the notions of higher incentives to invent through improved monitoring and reduced moral hazards. We therefore also tested several possible channels through which financial liberalization inversely affects innovative production. The literature suggests that financial reforms may negatively influence innovations in several different theoretical settings. It may do so by weakening the incentives to save and thus reducing the domestic resources available for facilitating invention, producing more instability and triggering financial crises that exacerbate economic fluctuations and dampen knowledge creation, or by enabling the financial sector to expand disproportionately and become more profitable and thus leading to more talent being attracted from the technology sector. Our results provide strong support for the hypothesis that financial liberalization relocates talent to the financial system, thus hurting the technology sector. There is also clear evidence supporting the view that financial liberalization retards technological development through inducing financial instability.