research and development investment and productivity growth in firms with different levels of technology

In the modern competitive world, research and development (r&d) and its overflowing technologies are the main basis of innovation, which in turn, can be determined as an important source of economic growth. investing in research activities can help firms with different technological levels, especially hightech industries to improve their productivity. this paper aims to analyze the role of r&d expenditures in total factor productivity (tfp) growth in iran’s industry sector. for this purpose, data from industries with different levels of technology (high, medium and low) over the period 19942010 is used. results show that r&d expenditures in hightech and then in medium/hightech industries have the most positive and significant effect on tfp growth. in addition, among hightech industries, r&d expenditures have the greatest impact on the productivity growth in drug and chemical industries related to medicine (code 2423) which has experienced significant progress in recent years.