R-D AND HIGH-TECH PRODUCT EXPORT RELATIONSHIP: AN INVESTIGATION ON COUNTRIES WITH LOW AND MIDDLE INCOME LEVELS

In this paper, the relationship between R-D expenditure and high-tech product exports was examined within the context of the 2000-2015 period data for twenty-two countries with low and middle income levels according to World Bank classification. The model examining the empirical relationship between R-D and high-tech product exports also included one and two period delay in R-D expenditure. The results based on the fixed effects within group forecast method showed that a 1% increase in R-D expenditures increased about 0.26% in high-tech exports in the same period. However, the tests have shown that heteroscedasticity and autocorrelation are present in the fixed effect model, and the fixed effect model has been re-estimated with the aid of Arellano, Froot and Rogers estimators, which produce resistant standard errors in case of varying variance and autocorrelation. According to the results of the resistant estimates obtained, 1% increase in R-D expenditures increased the high-tech product exports by 0.26% in the same period, while the exports of high-tech products increased by about 0.21% in the next period